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Commission Maintains Regulation Of Three Telco Services To Protect Consumers

The Commerce Commission announced today it will keep regulation in place for three wholesale telecommunications services to continue to promote competition and protect consumers.

The three wholesale services are number portability, interconnection with a fixed public switched telephone network (PSTN), and mobile co-location.

“After consulting with the sector, and interested parties, our view is that these services continue to play an important role in the market and should remain regulated for now,” said Telecommunications Commissioner Tristan Gilbertson.

Mr Gilbertson said number portability enables consumers to keep their existing mobile or landline number when switching to a different service provider. “It’s easy to see how people being able to keep their number if they choose to switch between providers drives competition for the benefit of consumers.

“Likewise, we have decided to continue regulating mobile co-location. This is important for driving competition because it allows operators to share mobile network transmission sites and related equipment with competitors, lowering the cost of providing services throughout the country compared to self-providing infrastructure from the ground up.”

Mr Gilbertson said fixed PSTN interconnection is used to enable consumers on different fixed networks to make calls to each other. However, the significance of this service is diminishing as consumers move to newer technologies, such as those delivered over fibre and wireless networks.

“Spark has commenced a process to decommission its PSTN in response to diminishing demand, but PSTN services remain important in many parts of the country, so we have decided we need to continue regulating this service for the time being,” he said.

Schedule 3 of the Telecommunications Act 2001 requires the Commission to consider every five years whether there are reasonable grounds for deregulating a number of wholesale services that are listed under Schedule 1 of the Act. Only these three listed services were assessed in this review with the others scheduled for review throughout the five-year cycle.

Mr Gilbertson said that each of these services is used by retail service providers to supply the most common retail telecommunications services to consumers. “As markets evolve, new retail services are developed and wholesale service providers can face increased competition to an extent that it may no longer be necessary to mandate access, but we are not yet at this point for these particular services,” he said.

The Commerce Commission published for consultation in March a preliminary view that these services should remain regulated. “In submissions on this draft decision, stakeholders largely agreed that the wholesale services under review should remain regulated for now,” Mr Gilbertson said.

The final decision is available on the Commission’s website.

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