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IHUG And Telecom Announce 0867 Agreement

In response to feedback from its ISP customers, particularly The Internet Group Limited (IHUG) as one of the country's leading ISPs, Telecom New Zealand Limited is deferring the implementation of its 2 cent per minute charge for residential Internet calls to ordinary local numbers.

IHUG's Managing Director, Nick Wood said "the deferring of the charging gives ISPs time to transfer to the 0867 service and is a welcome move by Telecom". The new date is 1 November 1999.

"IHUG has reached an agreement with Telecom in relation to 0867, the new Internet dial-up service introduced to the market recently by Telecom. These arrangements establish a rational and effective basis from which IHUG can provide excellent service to its customers, present and future" said Mr Wood.

"IHUG will use 0867 numbers to allow customers to dial into the Internet - these calls will be free for residential customers."

Mr Wood said; "we weighed up our options. Litigation is not our style and it's always costly and uncertain. There were various other options that all proved too difficult to action. It was essential for IHUG that we were satisfied 0867 would remain a quality service and this was key to our taking the service."

Bruce Parkes, head of Telecom's Industry Services Unit, confirmed that Telecom was pleased with its new arrangements with IHUG. "In light of the dramatic growth in the market for Internet services, Telecom is very pleased to have reached satisfactory arrangements with a very significant Internet Service Provider."

This means ISPs accounting for around 80% of Internet traffic have now agreed to use 0867, or 0873 (Telecom's IPNet service).

Mr Parkes reiterated that the 0867 service was available now. "A number of ISPs are already using 0867 numbers, ensuring the transition of customers well before 1 November 1999. As we've made clear, Telecom will sit down on a case by case basis with ISPs and meet the reasonable costs of changing to 0867."

Telecom also confirmed that its 0867 service would continue to offer New Zealanders a high quality connection to the Internet.

Mr Parkes said; "we are not changing our grade of service design standard for the Telecom network. We will continue to build our network to the same grade of service for both data and voice calls. In times of network overload and emergency we may manage voice and Internet calls differently to protect the network for both voice and Internet callers. We expect this to improve overall network reliability for all users including Internet users".

Mr Parkes also said "wherever Telecom's IPNet service has the same impact on a part of the Telecom network it would be treated the same as 0867 in terms of network management."

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