Trevor Mallard. Photo / Greg Bowker

Trevor Mallard. Photo / Greg Bowker

It may be time to fix your mobile phone costs for the next five years.

"Ridiculous," you say.

"No one would offer a deal like that, and I'd be a mug to take it."

Moore's Law, which says the capacity of silicon chips doubles every 18 months and the price halves, and Metcalfe's law, which gives a handy reckoning of the value of networks, would seem to indicate committing yourself to a technology spend five years out is folly.

But in the looking glass world of New Zealand telecommunications, the Five Year Plan has made a dramatic resurgence.

Showing economic acumen on par with Sir Robert Muldoon's outlawing of interest rate rises, economic development minister Trevor Mallard has declared Moore's and Metcalfe's laws don't apply here.

Telecom and Vodafone should be able to offer you a deal into 2012 because Mallard has guaranteed the extraordinary profitability of their mobile businesses until then.

He did that by rejecting a Commerce Commission recommendation to regulate mobile termination rates.

Instead the minister accepted offers from Telecom and Vodafone to reduce over five years the fees they charge other carriers to terminate calls on their networks.

Telecom's rate will drop from 20 cents a minute to 12, and Vodafone's will go from 20 cents to 14.

Compare that with Australia, where the regulator is proposing mobile termination drop to A9 cents from July 1.

Mallard got to make the decision after Telecommunications Minister David Cunliffe ruled himself out because of claims he has a conflict of interest.

Mallard said his decision to go with the "industry solution" followed a year-long process of consultation, review and analysis, so it could be seen as an informed decision under the Telecommunications Act 2001, and it would benefit end users.

Minus the spin, that means "Don't bother taking us to court, because all the boxes are checked."

Apart from the press release, there is no paper trail for the decision. Mallard just told Cabinet verbally what he had done.

One explanation put by industry watchers is bureaucratic infighting. By securing that result, Ministry of Economic Development officials ensure they still call the shots, through Ministers, rather than handing power over to the Commerce Commission.