The Ministerial Inquiry into Telecommunications has released an "Issues paper" laying out its terms of reference, and is now inviting submissions.
The Issues paper can be obtained from the inquiry’s Web site at http://www.teleinquiry.govt.nz .
Inquiry Chairman Hugh Fletcher says the Inquiry is seeking "maximum input from the telecommunications industry and telecommunications users, including the general public. To enable the greatest possible engagement, we have extended the deadline for submissions to 12 May."
A statement from the Inquiry says key points in the Issues paper are
interconnection, local loop unbundling, New Zealand’s approach to regulating telecommunications services as compared to other countries', the information economy, the Kiwi Share, network management (including 0867), cellular technology and numbering.
Fletcher says if there are issues the paper does not canvass, submitters are encouraged to draw them to the Inquiry’s attention. "The Inquiry is required to provide detailed recommendations to the Government on a range of issues. It is therefore important that, in addition to outlining any problems, submitters also consider solutions, including their costs and benefits, and whether structural, regulatory or industry self-regulation solutions are most appropriate."
The company whose battles with Telecom have helped define the debate, Clear Communications, is already circulating a report by Outcome Consulting called 'Assessment of the New Zealand Telecommunications Regulatory Regime 1989-99'. It concludes, among other things, that "there is strong evidence that the New Zealand consumer has not received the benefits that a truly competitive market would be expected to deliver" and that the regulatory trend in New Zealand has run counter to that in "progressive regimes" in other countries.
Outcome says the interconnect prices charged by Telecom are the amongst highest in the world and that Telecom shareholders earn significantly higher returns on equity than any other major New Zealand company - around 77% in both 1998 and 1999. The nearest contender was Fernz Corporation, which delivered around 13% in the same years.
It says significant decline in telecommunications charges "has only occurred where Telecom is subject to competition, for instance in national and international toll services. Prices have remained static or risen where Telecom has little or no competition" and that "New Zealand's performance in respect of prices to consumers is deteriorating relative to other advanced countries."
It concludes that the trend in regulation since 1989 "has been to allow a steady consolidation and strengthening of Telecom's monopoly power. The trend has been at the expense of consumers and new entrants to the industry."