Commerce Comm investigation

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marmel

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#27774 6-Nov-2008 11:35

Looks like yet another investigation into aspects of the NZ mobile market, this time mobile termination rates.

Hopefully they will have the b**ls and teeth to crack down on what appears to be overcharging by the big two.

Stuff article

sbiddle

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#176277 6-Nov-2008 11:49

The commerce commission should be doing something about this. Turning a blind eye is crazy and it just shows how the commerce commission gets things wrong so often. They investigate and block things that won't cause harm (such as the Warehouse takeover attempts) but ignore things affecting people on a day to day basis.

I'll bet with anybody that the day NZ Comms launches both Telecom and Vodafone will cut their MTR's. Why? Because at present much of the value of the termination is in effect zero rated due to the large amount of traffic that goes between both networks.

The price they actually charge each other is virtually meaningless as a result.

With the launch of a 3rd network however NZ Comms see inbound MTR as revenue and if both Vodafone and Telecom cut their rates to say 10c then NZ Comms would in effect be forced to do the same. This won't hurt Vodafone or Telecom much but would hurt NZ Comms.

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zocster

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#176286 6-Nov-2008 12:54

sbiddle:

I'll bet with anybody that the day NZ Comms launches both Telecom and Vodafone will cut their MTR's. Why? Because at present much of the value of the termination is in effect zero rated due to the large amount of traffic that goes between both networks.

I'm not much of a gambling man but do agree that it will happen. and for a country as advance as ours fees are a bit like extortion! sucks.

Andy Ghozali Geekzone Member	E: andy@ghozali.ru M: +64 21 395 458 A: Andy's Business Services, 231 High St, Christchurch 8011, NZ
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marmel

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#176292 6-Nov-2008 13:36

sbiddle:
The commerce commission should be doing something about this. Turning a blind eye is crazy and it just shows how the commerce commission gets things wrong so often. They investigate and block things that won't cause harm (such as the Warehouse takeover attempts) but ignore things affecting people on a day to day basis.

I think they were correct in blocking the warehouse takeover. There have been a couple of articles on 20/20 and 60 minutes over the last year or so which clearly show how damaging the big corporates that own the supermarkets are becoming. They screw the suppliers margin's down to next to nothing and then charge pretty much what they like to customers. They also prevent suppliers providing goods to smaller independents. The fact that there are two major players in the NZ market is one of the only things stopping grocery prices going throgh the roof.

Unfortunately with the warehouse closing their "extra" stores this now clears the way for one of the two taking over the chain. The warehouse could have provided real competition so it's a shame they didn't stick at it.

Balchy

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#176294 6-Nov-2008 13:59

Unfortunately with the warehouse closing their "extra" stores this now clears the way for one of the two taking over the chain. The warehouse could have provided real competition so it's a shame they didn't stick at it.

Off topic but....

Did you ever visit one of those stores? I think the awful produce/meat (half rotten some of the time) and the crap layout along with the lack of dedicated checkout lines had something to do with them shutting down - really whoever designed those stores need to be shot (referencing the Te Rapa store here, can;t comment on others)

For billions of years since the outset of time, every single one of your ancestors survived, every single person on your Mum and Dads side, successfully looked after and passed onto you life. What are the chances of that like?

sbiddle

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#176307 6-Nov-2008 15:08

A wee bit OT as well but the Comcom decision over TWH was fundamentally flawed.

They made a big deal out of blocking it. Their sole basis was that competition existed because of the Extra stores and selling the chain would lessen that competition in the grocery market. No other reason existed for them to block the sale.

Before this decision was announced TWH hade made it very clear the future of the Extra stores was virtually decided and that the stores would be pulled due to the extremely poor performance. Effectively the Comcom spent months of time and taxpayers $$ reaching a decision stopping the takeover on a single issue. This issue was effectuvely null and void because when TWN did announce the decision to dump the Extra format there then existed nothing to block the sale.

It was nothing but a waste of taxpaper $$ - $$ and manhours that could have been spent on more important issues like MTR and the lack of competition in the NZ mobile market.

TWH Extra stores were never in a position to dent the grocery market - certainly no more so than the existing red sheds. There is nothing stopping TWH from selling a larger range of groceries at present other than the fact their business model doesn't cope well with selling products and either 0% or negative margins as is the norm for specials in the supermaket industry at present.

ajw

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#176317 6-Nov-2008 16:07

marmel: Looks like yet another investigation into aspects of the NZ mobile market, this time mobile termination rates.

Hopefully they will have the b**ls and teeth to crack down on what appears to be overcharging by the big two.

Stuff article

Looks like the European Commission are doing a big investigation into fixed to mobile and mobile to mobile termination rates.
Read all about it especially the discussion document and submissions from the telcos.

Contributions to the public consultation on termination rates The European Commission conducted a public consultation on the draft Recommendation and accompanying Explanatory Note on the regulatory treatment of fixed and mobile termination rates in the EU between 26 June and 10 September 2008. In the course of the consultation, the Commission received comments from the respondents listed below (name of those respondents which have requested confidentiality are omitted). To display a non-confidential submission, please click on the name provided below. Confidential submissions are not accessible from the below list.

http://ec.europa.eu/information_society/policy/ecomm/library/public_consult/termination_rates/index_en.htm

sbiddle

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#176332 6-Nov-2008 17:13

The EU seem to be seriously looking at whether CPP is the best option for mobile.

At the end of the day is CPP a shonky business model or not?

I can see the irony that Telecom were spitting tacks and foaming at the mouth at CallPlus for their i4free concept of distributing termination revenue to 3rd parties and took drastic steps to stop this...All while Telecom Mobile sat there at the same time as a big cash cow with a business model that was significantly funded by the ~45c (off the top of my hear) MTR's that existed at the time. There are significant pros and cons to the CPP model and you can argue very hard that there should be significant changes. Maybe not rid rid of entirely but certainly termination rates of ~ 5c - 10c per minute tops.

ajw

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#176404 6-Nov-2008 20:59

sbiddle: The EU seem to be seriously looking at whether CPP is the best option for mobile.

At the end of the day is CPP a shonky business model or not?

I can see the irony that Telecom were spitting tacks and foaming at the mouth at CallPlus for their i4free concept of distributing termination revenue to 3rd parties and took drastic steps to stop this...All while Telecom Mobile sat there at the same time as a big cash cow with a business model that was significantly funded by the ~45c (off the top of my hear) MTR's that existed at the time. There are significant pros and cons to the CPP model and you can argue very hard that there should be significant changes. Maybe not rid rid of entirely but certainly termination rates of ~ 5c - 10c per minute tops.

"Bill and Keep" would be the best charging model of the lot.