Commerce Commission settles interconnection price

Telecommunications Act: Commerce Commission settles interconnection price

The Commerce Commission has today released its first access determination under the Telecommunications Act 2001. The Commission’s determination relates to price and non-price terms for interconnection between the TelstraClear Limited and Telecom New Zealand Limited networks.

Telecommunications Commissioner Douglas Webb announced the interconnection price at 1.13 cents per minute. The interconnection price is the charge payable by one carrier to the other for handling various calls between the two networks. This includes the local end of toll calls, toll free calls and payphone calls. The price is effective for 12 months from 5 November 2002. In addition, TelstraClear and Telecom have agreed to backdate the price to 1 June 2002.

“The final price of 1.13 clusters New Zealand with Australia and the United Kingdom. It is above the United States and Canada and below Ireland and the continental European prices,” said Mr Webb.

He explained that following the filing of the TelstraClear application in May, the parties reached agreement on a number of disputed terms. The remaining terms are settled by the Commission’s decision.

“While the parties could not agree on the interconnection price, which was left for the Commission to decide, the application process proved to be an effective blend of commercial negotiation and regulation. The parties can take credit for resolving most of the issues originally raised in the application,” said Mr Webb.

The determination, which includes an executive summary and appendices, can be downloaded as pdf files from: http:// http://www.comcom.govt.nz/telecommunicationsregulation/commissiondecisions

Background

TelstraClear applied to the Commission for an access determination relating to access to Telecom’s fixed public switched telecommunications network (PSTN) and interconnection between that network and TelstraClear’s fixed PSTN, and wholesale (retail minus) services.

For administrative ease and efficiency, the Commission separated the application into two types of service – interconnection and wholesale (retail minus). Today’s determination related to the interconnection services. The Commission will release its draft determination in relation to the wholesale element of the application later this month.

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