Regulator to focus on mobile termination rates

Tuesday 28th September 2010

The Commerce Commission wants to stick to price regulation over mobile termination rates as it prepares to hold a workshop on the issue next week.

The regulator says the non-price terms of existing commercial interconnection agreements don't need to be brought under its remit, and it will let them stand unless the industry provides "compelling" reasons for them to be reined in.

"The focus on price terms in the standard terms determination will address a key driver to New Zealand's high mobile retail prices," Telecommunications Commissioner Ross Patterson said in a statement.

"Unless the industry provides compelling arguments to the contrary, non-price terms such as operational arrangements and technical specifications will continue as negotiated."

The commission will host a workshop next week as it gears up to regulate the fees phone companies charge each other for terminated calls on their network, and is undecided on its preferred pricing method.

It's open to the setting of mobile termination rates benchmarked against future pricing; so called 'bill and keep' pricing where rival networks agree to end calls from each other at no charge; or a "hybrid" bill and keep option.

The workshop will discuss the commission's proposed approach to regulation, whether fixed line-to-mobile and mobile-to-mobile calls should have a single price list, and any other matters participants want to cover. The workshop won't re-litigate whether regulation should provide for glidepaths where the phone companies lower termination rates over a course of time.

Last month, Communications Minister Steven Joyce accepted the regulator's recommendation to set termination rates. He asked the commission to review its earlier advice to accept the phone companies' price plans after a Vodafone New Zealand plan fell foul of some officials.

The regulator made a 360-degree turn over the fees, having earlier flagged it would recommend regulation in a draft determination last year when Commissioner Anita Mazzoleni took the lead on telecommunications issues in the absence of Patterson.

The commission wants to have the final terms completed by the end of March next year.

Businesswire.co.nz

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