The Minister should accept the recommendation

Author's note by jointhedebate, on 10-Mar-2010 09:13 , user id: 12464)

@DeroyBoy, not quite. Mobile to mobile is in balance between providers so there won't be much of an issue there.

But in fixed to mobile, Telecom has the lion's share of the market - over 80%. So we reduce the price landline providers will pay, the question is, will they pass that on to customers? Overseas, the answer is no - they tend to pocket most of it. But the Commerce Commission is absolutely convinced they will here. Ideally they'll do a post-implementation review in a year or so's time, but that's not required by law.

@Simon, Sure. Once you've built a network to reach 97% of the population and millions in marketing teaching the market what a TXT message is and millions more setting up billing payment systems to handle all the traffic (roughly 600m TXTs a month and climbing) then yes, from that point on the TXT itself is relatively cheap.

We've spent around $3bn in capital expense and a further couple of billion in operating expense to get to that point.

The point around TXT spam is that the only way to stop TXT spam becoming as outrageous as email spam is to charge the senders for their content. That's stopped it almost entirely until now. The Commerce Commission has taken our argument about that on board and instead of going to straight bill and keep for TXT messaging, they've opted for a hybrid model that includes a billing option should the TXT balance get out of whack. Human to human TXT messaging tends to balance out but machine to human TXT messaging is all one way. Sure sign that it's spam.

@Chris, hopefully some of the unplesantness we've discussed will be avoided by acceptance of the Undertakings.

Author's note by jointhedebate, on 10-Mar-2010 11:04 , user id: 12464)

@Chris, no, not that networks disable TXT but that customers who pay to receive them don't give out their numbers as readily.

Hopefully the "hybrid" bit of our hybrid bill and keep model will mean we can avoid the worst of the TXT spam.

Author's note by jointhedebate, on 10-Mar-2010 11:27 , user id: 12464)

@chris, they tend not to give out their number to anyone because they pay to receive calls/TXTs.

I find telemarketers annoying but if I was PAYING to receive their calls, I'd be furious. TXT spam is the same.

Author's note by jointhedebate, on 10-Mar-2010 16:38 , user id: 12464)

Sorry, no... they charge going both ways. Pay to make, pay to receive. BUT they don't have MTRs at all - so they claim it's better for consumers.

Not sure I like that idea. I know lots of people who don't use their phones that much - they'd end up giving up their connection if they paid to receive calls/TXT.

US market penetration has topped out at around 80% while everywhere else in the world it's growing past the 100% mark.

Author's note by jointhedebate, on 10-Mar-2010 17:27 , user id: 12464)

@DeroyBoy, I had a look at the AT&T prepay rates and you pay a lot more than you do here to make a call and just as much again to receive - even for TXT messages...

@AJW, two different measures there - that's number of minutes rather than market penetration. The OECD figures for market penetration put the US at the bottom end while countries like Denmark and Sweden are well over the 100% mark. Some would have you believe that's because they HAVE to carry two phones, but the Drop the Rate campaign's own research shows only 3% of NZers carry two phones and there's no word on whether that's a personal choice or if it's my phone/work phone etc.

I'm always cautious with US data because they tend to conflate figures and measure things in a different way to the rest of the world. I'm not sure if those figures from the Economist include incoming minutes as well as outgoing (on the basis that they're all paid for) or not. Our figures would only be outgoing minutes because that's all we count.

Cheers

Paul

Author's note by jointhedebate, on 11-Mar-2010 11:13 , user id: 12464)

Hi all,

none of which has a blind bit to do with MTR and everything to do with having:

- 250m potential customer base
- multiple providers
- huge interest in local content instead of international content

There are lots of reasons why prices are the way they are in NZ versus the US versus Holland etc... MTR is a small component of that pricing.

Author's note by jointhedebate, on 11-Mar-2010 11:52 , user id: 12464)

@Chris, the OECD says no - when you compare the US pricing with the rest of the OECD the Americans are ... dead last.

cheers

Paul

Author's note by jointhedebate, on 11-Mar-2010 12:09 , user id: 12464)

We did and that's why part of our Undertaking is a glide path that manages the change so we can avoid that kind of thing.

Cheers

Paul

Author's note by jointhedebate, on 12-Mar-2010 08:35 , user id: 12464)

@Chris, the minister called for submissions by Monday. He's now going to take those and the MED's report into consideration when looking at the ComCom recommendations.

@simon14, as I've said, the rest of the world charges things like minimum monthly spend, charging to receive calls etc when they have no MTRs. We've argued strenuously against that - and offered a solution that SHOULD avoid the worst of those things. Up to the minister now.

Paul