Gov’t agency suggests lower prices will increase competition

The National IT and Telecom Agency has given the telecommunications industry a slap over the wrist for maintaining high prices for their text messaging services.

The agency, which is Denmark’s most important regulatory body for the industry, is now calling for more regulation to improve competitiveness.

The profit being made on text messaging is considerable. Last year mobile users sent more than 13 billion messages. This traffic cost telecommunication companies 286 billion kroner, or about 0.02 kroner per message, but they charged their customers as much as 3.2 billion kroner for this service.Commenting on the scale of the profits, Finn Petersen, the deputy head of the National IT and Telecom Agency, said: ‘We believe that there is a need to regulate this area. The lack of competition is creating prices which are too high.’

The agency has proposed that mobile phone companies reduce their fees by 20 percent – from 20 øre to 16 øre per text message – in order to increase the level of competition in the industry.

Jesper Theill Eriksen, who heads the consumer division of TDC, the nation’s largest telecom, said he felt the market was already competitive.

‘I simply cannot believe that a clampdown in companies’ text pricing will make any difference,’ he said.

TDC, and its no-frills subsidiary Telmore, have a 35 percent share of the mobile texting market.