Commerce Commission adopts 'retail minus' Bitstream pricing

Ihug and CallPlus win round two of pricing dispute

The Commerce Commission has decided to change its pricing and its pricing methodology for Telecom's Unbundled Bitstream service following objections from CallPlus and ihug.

In a draft reconsideration released today the Commission says it has changed its methodology in light of major changes to Telecom's retail broadband plans and to reflect current market conditions.

Retail minus pricing means Telecom must provide a margin between the price it charges for its service and the retail price charged to the customer.

The commission set pricing for bitstream services in June 2006, but the two service providers applied for a review of that decision in December.

The introduction of Telecom's Go Large plan in October last year was seen as one material change in the market that led to today's decision.

Submissions on today's draft decision are open until 7 March.

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