Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Decision to Investigate Mobile Termination Rates

Decision to Investigate Mobile Termination Rates

The purpose of this paper is to set out the Commission’s reasons for deciding to investigate mobile termination rates.

The Commission has received complaints that the lack of competition in the mobile termination market results in unreasonably high charges for fixed-to-mobile calls in New Zealand.

Mobile termination relates to the termination of calls to mobile customers, and is a component used in the supply of various downstream retail services such as fixed-to-mobile and mobile-to-mobile calling services.

The Commission is satisfied under clause 1(a) of Schedule 3 to the Telecommunications Act 2001 (‘the Act’) that there are reasonable grounds for an investigation into mobile termination rates.

The Commission has considered the following factors in making its decision to investigate mobile termination rates:

There are indications that mobile termination prices in New Zealand may exceed cost by a significant margin. Cost-based estimates of mobile termination rates in comparable jurisdictions appear to be well below the current New Zealand rates. If this is proven to be the case, a further issue for the Commission to address is the degree to which a reduction in New Zealand wholesale mobile termination rates will flow through to reductions in retail fixed-to-mobile rates.

The owners of mobile networks, in this case Telecom New Zealand and Vodafone, appear to have a substantial degree of market power in terminating calls on their mobile networks. A number of overseas regulators have identified competition concerns in relation to mobile termination services. Overseas regulators have identified the calling party pays arrangement for calls to mobiles as being a source of market power. The Commission considers that an investigation is necessary to determine whether similar competition issues exist in New Zealand.

With 2.8 million mobile phones in New Zealand and 1.7 million fixed lines, the termination of mobile calls is relevant to most phone users. Spending on calls to mobile phones makes up a significant portion of spending on telecommunications services.

The Commission will commence an investigation pursuant to clause 2 of Schedule 3 of the Act on whether or not mobile termination should be regulated by including it in Schedule 1 to the Act as a designated service.

Douglas Webb

Telecommunications Commissioner

© Scoop Media

Business Headlines | Sci-Tech Headlines


I Sing The Highway Electric: Charge Net NZ To Connect New Zealand

BMW is turning Middle Earth electric after today announcing a substantial contribution to the charging network Charge Net NZ. This landmark partnership will enable Kiwis to drive their electric vehicles (EVs) right across New Zealand through the installation of a fast charging highway stretching from Kaitaia to Invercargill. More>>


Watch This Space: Mahia Rocket Lab Launch Site Officially Opened

Economic Development Minster Steven Joyce today opened New Zealand’s first orbital launch site, Rocket Lab Launch Complex 1, on the Mahia Peninsula on the North Island’s east coast. More>>


Marketing Rocks!
Ig Nobel Award Winners Assess The Personality Of Rocks

A Massey University marketing lecturer has received the 2016 Ig Nobel Prize for economics for a research project that asked university students to describe the “brand personalities” of three rocks. More>>


Nurofen Promotion: Reckitt Benckiser To Plead Guilty To Misleading Ads

Reckitt Benckiser (New Zealand) intends to plead guilty to charges of misleading consumers over the way it promoted a range of Nurofen products, the Commerce Commission says. More>>


Half A Billion Accounts, Including Xtra: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>


Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news