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Commerce Commission Releases Discussion Papers

Issued 5 April 2002

Commerce Commission Releases Two Telecommunications Discussion Papers

The Commerce Commission today released two significant discussion papers as part of its new responsibilities under the Telecommunications Act 2001 (the Act). The reports are titled“International Benchmarking” and “Interconnection Pricing Methodology.”

The Commission appointed US-based consultants CostQuest Associates and Melbourne-based Frontier Economics to compile the Benchmarking and Interconnection Price Methodology reports respectively. The Commission worked with both consultants in the preparation of the reports and encourages interested parties and industry participants to make submissions based on the papers.

International Benchmarking
The Act provides for the Commission to use International Benchmarking when making an initial pricing determination. This report describes the methodology for benchmarking interconnection prices and retail-minus wholesale discounts, and compares the price across comparable overseas jurisdictions.

Interconnection Pricing Methodology
Interconnection is the arrangements between telecommunications operators that allows telephone users to call people serviced by another operator. This report examines the relative merits of two approaches to determining the price of interconnection for several types of phone calls. Interconnection payments are made between telecommunications operators.
The Commission invites interested parties and industry participants to make written submissions on the methodology and proposed approaches presented in these documents. After considering the submissions, the Commission will hold a public conference in Wellington on 8-9 May. The conference allows interested parties to make oral presentations based on their submissions to the Commission, and for the Commission to ask questions.

Both reports are available (as pdf files) on the Commission’s website,

The Commission released on March 22 the first of two discussion papers outlining its proposed approach under the Act to determining the cost of the Kiwi Share – now called the Telecommunications Service Obligations (TSO). The second TSO discussion paper will be released in April, and a conference will be held in Wellington on 21-23 May.

Submission details
The closing date for submissions, together with electronic versions, is 26 April 2002. Electronic versions should be emailed to, and will be published on the Commission’s website.

Hard copies of submissions must clearly identify which report they relate to, and be posted to:
Commerce Commission
PO Box 2351

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