Mobile roaming probe launched by Commerce Commission

Photo / Paul Estcourt

The Commerce Commission is to investigate whether the price of national mobile roaming should be regulated.

National roaming allows subscribers of one mobile network to use their handset on a different mobile network to make and receive calls.

It allows a new entrant to offer nationwide services while it builds its own network.

Fifteen months ago the commission made a recommendation that meant the price of mobile roaming should not be regulated, but today the regulator said it considered prices in current commercial roaming agreements may be "significantly" above cost.

The commission said it also had other concerns regarding national roaming, and the mobile market in general, suggesting an investigation may be appropriate.

Those concerns included the ability of future potential market entrants to negotiate competitive agreements in a timely manner.

Today's announcement on roaming coincided with the release of the commission's draft report on its investigation into mobile termination access services.

Mobile termination prices are the wholesale charges mobile phone companies charge for terminating calls or texts from other fixed or mobile networks.

The commission recommended mobile termination prices should be regulated, and that undertakings submitted in lieu of regulation by Vodafone, Telecom and 2degrees should be rejected.

"Overall, the commission has estimated that the retail cost of calling a mobile from a fixed line could be significantly lower as a result of regulation," commissioner Anita Mazzoleni said.

In the past, the commission has used mobile termination rates as a proxy for mobile roaming rates.

It was in light of the benchmarking contained in the mobile termination report, that the commission considered prices in current commercial roaming agreements may be too high.

"National roaming and mobile termination are distinct but related services in the sense that very similar network elements are used to provide these two services," said Mazzoleni.

Due to that relationship, the commission's benchmarking for mobile termination was likely to inform its view on an appropriate price for national roaming in the investigation.

Given the inter-relationship between the commission's current mobile termination investigation and the national roaming service, the commission said it intended to move quickly to align the two processes.

It planned to start an investigation into national roaming in August, with a view to releasing a draft report in mid-October, with the investigation finished by the end of February.

Parties still had an opportunity to reach acceptable commercial solutions at any time, including before the commission formally started the investigation, the commission said.

- NZPA