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Final Determination for proposed Vodafone service

Media Release

Issued 28 September 2006/045

Telecommunications Act: Commission issues Final Determination for proposed Vodafone service

The Commerce Commission has issued a Final Determination for Vodafone’s application for an access determination under the Telecommunications Act 2001. This service will provide interconnection of local calls between Telecom’s fixed network and Vodafone’s cellular network for those Vodafone customers with a local number.

The Commission’s conclusion is that Telecom and Vodafone should exchange local calls at a reciprocal price of zero in accordance with the ‘pure bill and keep’ pricing method.

The determination relates to the provision by Telecom of interconnection with Telecom’s fixed PSTN (Public Switched Telephone Network) for local calls to and from Vodafone’s local numbers. It does not include calls to and from Vodafone’s mobile numbers.

Interconnection is the service whereby carriers exchange call traffic between each other’s networks, enabling customers of one network to call customers on the other carrier’s network. In this case it would enable Telecom customers to make, for example, a local call to a Vodafone customer with a local number.

A copy of the Determination is available on the Commission website.

Background
On 13 January 2006 Vodafone New Zealand Limited (‘Vodafone’) filed an application with the Commission for a determination requesting access to interconnection with Telecom's fixed PSTN under Schedule 1 of the Act.

On 19 June the Commission issued a draft determination for this application and called for submissions. Both Telecom and Vodafone made submissions.

Vodafone intends to launch a geographically structured service over its cellular network. Customers subscribing to the service will be allocated a local number and can make or receive local calls while the customer remains within a geographic area surrounding the customer’s home or business (the ‘homezone’).

To be able to introduce the service Vodafone needs an interconnection agreement with Telecom for local calls between Vodafone local numbers and Telecom’s fixed PSTN. Currently Vodafone and Telecom do not have such an agreement.

‘Pure Bill and Keep’ is a pricing scheme for the two-way interconnection of two networks under which the reciprocal wholesale call termination charge is zero – that is, each network terminates calls from the other network at no charge.

ENDS

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