Vodafone New Zealand Unhappy With Proposed Termination Charge Regulation

Vodafone New Zealand has stated that mobile phone users will suffer if the Commerce Commission’s proposal to regulate Mobile Termination Rates (MTRs) goes ahead.

“There’s a myth that this regulation will result in lower mobile call prices. If anything, the opposite is true. The Commission itself acknowledges that this regulation means that mobile customers will end up paying more for their calls. Its own prediction is that about 18,000 people will give up having mobiles altogether if this regulation is imposed.” Says Vodafone Finance Director David Sullivan, who also went on to state, “Telecom is the major beneficiary of this regulation. We are very concerned that we are being forced to cut our mobile termination prices which ultimately make more money for our biggest competitor, creating an uneven playing field in the mobile market.”

Vodafone has already offered to voluntarily cut its MTR in an effort to avoid the proposed regulation.

Mobile Termination Rates make up a significant percentage of the total cost of an inter-network call (e.g. Telecom to Vodafone), and there has been much lobbying to bring this cost down, and with it, the cost per minute of calls between networks.