Responding to the price cuts announced by British Telecommunications Plc last week, Mercury Communications Ltd’s chief executive Peter van Cuylenberg has said that Mercury will definitely be announcing price moves over the next few weeks (CI No 1,730). British Telecom’s reductions in overseas calls and freezes or below-inflation rises on domestic charges overturns Mercury’s former price competitiveness, especially on the lucrative international routes. Comparing Mercury’s current prices with the proposed BT ones, Mercury’s prices to the US, for example are now 11% more expensive at peak rate – whereas they were 9% cheaper. To Japan, Mercury is 4% dearer and it costs 3% more on many European routes. However Mercury says that it will maintain its price leadership – and a spokeswoman pointed out that by the time the BT cuts are implemented in September, Mercury would probably have re-adjusted its prices. Van Cuylenberg added that Mercury’s volume discounts would be easier to understand and repeated his commitment that the company would double its share of the market over the next five years. He added that small and medium sized businesses would be particularly targeted.
