Ihug has negotiated a delay in the implementation of Telecom's two cents per minute charge for residential Internet users.
The ISP also appears to have won itself both a service level agreement on its use of Telecom's 0867 service and financial compensation for making the switch.
A statement released by Telecom late on Friday said that "in response to feedback from its ISP customers, particularly The Internet Group Limited (Ihug) as one of the country's leading ISPs," Telecom would defer the introduction of charging for Internet calls to "ordinary local numbers" until November 1.
The release quoted Ihug managing director Nick Wood as saying the new arrangements " establish a rational and effective basis from which Ihug can provide excellent service to its customers, present and future.
"We weighed up our options. Litigation is not our style and it's always costly and uncertain. There were various other options that all proved too difficult to action. It was essential for Ihug that we were satisfied 0867 would remain a quality service and this was key to our taking the service."
The Telecom statement says the agreement of Ihug to go along with the scheme means "ISPs accounting for around 80% of Internet traffic" have now agreed to use 0867, or 0873, Telecom's IPNet service. Internet calls made to other numbers will attract the two cents per minute charge from November.
Clear Net is not among those ISPs, and is understood to be still considering legal action. Bruce Parkes, head of Telecom's Industry Services Unit, said in the statement that "Telecom will sit down on a case by case basis with ISPs and meet the reasonable costs of changing to 0867."
Telecom has also refined its message on the status of 0867 Internet calls, which it initially indicated would take a back seat to voice callsin timkes of network overload.
Parkes now says that "in times of network overload and emergency we may manage voice and Internet calls differently to protect the network for both voice and Internet callers. We expect this to improve overall network reliability for all users including Internet users".
Parkes also says that "wherever Telecom's IPNet service has the same impact on a part of the Telecom network it would be treated the same as 0867 in terms of network management."