TelstraClear sale prompts ComCom to monitor fixed-to-mobile rates

Telecommunications Commissioner announces he will extend his monitoring of the telco market

Prompted by the sale of TelstraClear to Vodafone, the Telecommunications Commissioner Stephen Gale says he will now monitor fixed-to-mobile pricing.

“The merger of Vodafone and TelstraClear will bring about major changes in the telecommunications sector. Now that the merger has been confirmed, we plan to observe its impact on fixed and mobile pricing – separately and in bundles – and monitor any changes in the market,” Gale says in a statement today.

“We aren’t anticipating any anti-competitive pricing arrangements coming from the newly merged entity. However, we are required to monitor developments in the telecommunications sector.”

The Commission says the merger means that Vodafone will move from being a provider of mainly mobile services to also having the fixed line services currently owned by TelstraClear.

“We already regulate mobile termination rates to minimise the barriers to competition in the mobile market, and monitor mobile pricing in case any barriers are raised by new pricing plans. We have similar concerns in fixed-to-mobile pricing so will watch and see what fixed-to-mobile pricing plans appear in the market,” says Gale.

The application to clear the sale was assessed under the Commerce Act. Following approval, Commission Chair Mark Berry advised the telecommunications commissioner that there were no competition issues under the Commerce Act, but he invited the commissioner to monitor developments under the Telecommunications Act, the media statement says.

The Commission will add fixed-to-mobile price monitoring to its suite of telecommunications market monitoring under section 9A of the Telecommunications Act.

Vodafone New Zealand announced yesterday it had completed its acquisition of TelstraClear for $840 million.

“We can now start bringing the businesses together and releasing the potential for our customers. Our combined strength in both mobile and broadband means we can help our customers do their thing better – whether that’s mobile services, broadband, pay TV or sophisticated ICT services across New Zealand,” Vodafone CEO Russell Stanner says.

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