16 August 2005

Talk Is Cheap Telecom - Peters

Rt Hon Winston Peters says that while Telecom and Vodafone have offered to drop their mobile charge rates voluntarily, regulation of the industry is the only way to ensure reasonable mobile charges in the long term.

Telecom is planning to drop charges for landline to mobile calls by 30 percent in four years, but Mr Peters said the offer falls short of a fair deal for the consumer. He noted that Australian operators have already been ordered to lower termination rates by 50 percent before 2007.

“This offer is an attempt by Telecom to put a stop to regulation of the telecommunications industry.

“Their monopoly over the industry has allowed them to charge excessively for mobile use. As a result, New Zealand has one of the highest termination costs of any OECD country.

“I shudder to think that we are relying on the goodwill of Telecom to keep prices down when they seem to enjoy nothing more than bathing in the money of their customers.

“Without regulation there is no way to ensure that the lower costs Telecom and Vodafone are offering now will continue in the future.

“Setting reasonable standard rates in communications is absolutely essential, and the Government should be doing everything it can to ensure that consumers are not being ripped off. We need to create real competition in the telecommunications market place that guarantees reasonable costs in the long term,” said Mr Peters.

ENDS

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