Hutchison Austria raises prices for existing mobile customers

VIENNA Fri May 2, 2014 9:41am EDT

VIENNA May 2 (Reuters) - Hutchison Whampoa's Austrian telecoms business Drei will raise some of its tariffs for existing mobile customers in July, it said on Friday, after similar moves by its bigger rivals.

Drei said the increases of 2-3 euros ($2.77-4.16) a month would be mainly for its older SIM-only tariffs for pre-paid users without long-term contracts and would affect about 8 percent of its customer base.

Telekom Austria, the country's biggest operator, has raised prices several times since Drei bought Orange Austria last year, reducing the number of carriers to three from four. T-Mobile Austria has increased prices.

The moves have eased the cut-throat price competition that defined the Austrian market, though the nation of 8.5 million still has some of the lowest mobile prices in Europe.

The Austrian market is closely watched by European regulators, who are considering whether consolidation other countries, including Ireland and Spain, would result in higher prices for consumers.

Drei, still the smallest Austrian carrier, said the tariff increases would help to cover the cost of a frequency auction in which it spent 330 million euros last year, as well as subsequent investments in a next-generation 4G network.

"For this reason, Drei will adjust a few tariffs in July, which according to our new calculations no longer cover their costs," the company said in a statement. ($1 = 0.7212 Euros) (Reporting by Georgina Prodhan; Editing by David Goodman)