Screeb: And a bit more on topic: Paul, why is Telecom so concerned with termination charges being lowered so drastically? Vodafone's public position on the matter is obvious - they're getting ~$100 million a year in MTR charges from Telecom. Hey, free money! But Telecom seemingly has no reason - after all, I'm sure they don't like giving away $100m a year to their "competitor". Of course, we all know the true reason both companies don't want the rates lowered - which leads me to: Why isn't Vodafone saying anything about MTRs being a barrier to entry? Instead, you insist on talking about pass-through, which is really besides the point.
I've yet to see Telecom complain about MTR rates dropping. Infact Telecom have already put their offer of a drop to 7c by 2015 on the table and are committed to 100% passthrough of those drops for fixed to mobile calling.
What I have no idea on (and would like clarification) is whether Telecom's 7c offer includes both fixed to mobile termination as well as mobile to mobile termination.
Telecom aren't necessarily the good guys here either. They're still charging 63c per minute for fixed to mobile calls if you have no calling plan. Even with 100% passthrough (which they are committed to) that will only drop that rate to 55c per minute (is the 7c is a GST incl price?). That's still a very tidy profit.
That then brings me to my next point - Vodafone today criticised fixed line carriers who haven't delivered on 100% passthrough of the lower MTR costs that have occured. What's slightly hypocritical is the fact that WxC for example only charge 30c (or 27c + GST for business customers) for calls to mobile phones. This is under half of what Telecom are charging.
Who's offering the better deal? A carrier who commits to 100% passthrough but still charges 63c per minute? Or a carrier that may not have delivered 100% passthrough on recent MTR drops but charges 33c per minute less, which is over a 50% reduction?
Regulation is the big downfall of CPP and unfortunately there are no right or wrong answers.