Smaller mobile companies urged the European Commission on Monday not to dilute or drag out moves to slash the fees operators charge each other.
European Union Telecoms Commissioner Viviane Reding is due to adopt guidelines to phase in by 2011 cuts of up to 70 percent in mobile call routing or termination fees.
Sector-wide, the fees represent 15 billion to 20 billion euros a year.
An operator pays the fee to another operator whose network it needs to complete a call. Reding believes the rates are excessive and cutting them would reduce customer bills.
This view was backed on Monday by a group of smaller operators such as Bouyges of France, Base in Belgium, Play in Poland and 3 in Britain.
They nip at the heels of big operators like Vodafone, Orange and T-Mobile.
These challengers have smaller networks and end up paying large amounts of termination fees that can account for up to a fifth of revenue for a big operator such as Vodafone.
Vodafone and others say slashing fees would make handsets costly for poorer customers and may result in people having to pay for receiving as well as making calls.
If Reding's guidelines are properly applied, termination rates would fall from above 6 euro cents per minute to 1.5-2.5 euro cents, the Commission has said.
"This will be good for the consumer and please do not worry that some customers won't be served," Base CEO Libor Voncina told Reuters.
Regulators are already putting downward pressure on rates. French telecoms regulator Arcep has proposed that operators cut termination fees to about 3-4 cents by end-2010.
The challengers group expects a final compromise on Reding's guidelines to result in rates of about 3 to 4 cents, still low enough to force business models to change and boost competition.
But they fear pressure on Reding to cut termination rates over a longer period than originally planned. "If you go down with a slow slope you will kill challengers on the way," Base's Regulatory Affairs Director Marc van Asbroek said.
The United States has no termination rates but uses "bill and keep" whereby operators don't charge for completing a call but customers may pay a tariff for receiving calls.
Termination rates were not being scrapped in the EU and a hybrid version of bill and keep would emerge. "I don't think consumers will be paying for receiving calls," Voncina said.
Bouygues Deputy Chairman Emmanuel Forest sees business models moving more towards flat fees for customers. "We are completely capable of adapting the pre-paid model with the right glide path to lower termination rates," he told Reuters.
Lower termination rates were being factored into the company's business model and they will allow Bouygues to be more aggressive in offering attractive bundles to customers, he said.
Britain's 3 UK said in a statement that if termination rates are cut in line with Reding's plans, it will offer "a handset and all you can eat voice calls to mobile and fixed numbers, text and Internet" for about 25 pounds ($38.58) a month.
If termination rates fall to around 1 euro cent, Poland's Play said it would offer unlimited tariff plans to all networks in Poland for about 30 euros ($37.33) a month.
Reding's spokesman said the guidelines were being finalised and they will be ready next month.
After further consultation they will be formally adopted in early 2009, he said, but gave no indication whether the full impact of the guidelines would be delayed.
Termination rates could disappear in Europe over time, Reding's spokesman added.
"This would be pro-competitive, reduce administrative cost and red tape and lead to even lower charges for consumers. In this context, Commissioner Reding welcomes the direction now taken by the French regulator Arcep on this important matter."
Mobile phone sector lobby group the GSM Association said Reding's plans were a fundamental shift in how termination rates were calculated and it looked forward to a thorough impact assessment from the Commission.