User group: ComCom 'got it wrong'

TUANZ backs commissioner Mazzoleni

The Telecommunications Users' Association of New Zealand says the Commerce Commission has "got it wrong" in deciding to recommend against mobile termination rate regulation.

“We are surprised and disappointed at the recommendation by the Commerce Commission that mobile phone termination rates should not be regulated,” says TUANZ CEO Ernie Newman.

“While we recognise the enormous amount of consultation and research that has gone into the Commission’s investigation over these past six years, we think the commissioners have got it wrong."

TUANZ represents some 450 members, mostly large business users.

“The process leading to the voluntary undertakings demonstrated the breathtaking gap between the actual cost of terminating calls from competing networks, and the amount the two major operators have been charging. While the reduction of about 80 percent appears generous on the surface it is still insufficient to address the huge barrier to competition posed by these excessive charges," Newman says.

“Its hard to see how a dominant mobile operator that sells SMS text messages on the retail market for about half a cent each, can be allowed to charge its competitor several times that amount to receive one. That doesn’t seem to us to fulfil the test of encouraging competition in the long term interests of the end user. It entrenches the dominance of the two large networks to the detriment of smaller players and new entrants.

“We think the dissenting view of commissioner Mazzoleni is more credible. We will be making submissions to the minister accordingly.”

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