NZ to regulate mobile termination charges

Mobile phone call charges look set to fall in New Zealand after its government announced it would regulate Mobile Termination Rates (MTR).

Today's announcement follows a u-turn by industry regulator, the Commerce Commission, which had voted against regulation, but changed its mind after an aggressive on-net pricing plan by Vodafone was seen to "undermine" competition.

The decision to regulate has received much praise across the telco sector, which says it should boost competition in the marketplace and lower prices.

"Certainty around mobile termination rates gives us increased confidence as we plan further network investment, sign leases for stores and prepare to offer pay monthly plans," Eric Hertz, CEO of mobile operator 2degrees said in a media statement.

In a statement, opposition Labour ICT spokesperson Clare Curran welcomed the move as a "victory for consumers".

However, it has come "many years too late", according to Ernie Newman, chief executive of the Telecom Users Association of New Zealand (TUANZ), noting that he and others had campaigned on MTRs for seven years, during which time consumers will have faced several hundred million dollars of "excess charges" by mobile operators.

Such a lack of regulation has led Vodafone to charge far less for on-net calls, which far from being a discount to its customers, helps block competition, Newman added.

Government and industry regulators will begin working with the telco sector, aiming to have the regulations in place by September.