21 March 2006
Telecom industry regulator Ofcom has put forward proposals recommending that price controls on the home phone market should be lifted 22 years after they were first put in place.
If the proposals are accepted all phone companies would be free to set their own prices for line rental and calls from the start of August.
The regulator has suggested the deregulation of the market as the development of new technology and the rise of greater competition since BT's privatisation have pushed down call prices by more than 50% over the last decade.
It is thought that the development of low-cost internet phone technology will provide further competition in the future, with local loop unbundling also allowing a range of broadband internet providers to compete for customers using existing phone lines.
Increasing mobile phone use was also cited by the regulator as creating greater downward pressure on home phone call prices, with 31% of all UK voice calls now coming from mobile phones.
Ofcom chief executive Stephen Carter said: "More than 20 years on, sustained competition, informed customers and the rapid growth of new technology provide the necessary environment for substantial deregulation."
A public consultation will be carried out before the proposals are confirmed. Ofcom said it planned another review of the market in 2007.
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