Vodafone statements misguided and collusive

21 July 2006

Media Statement

Econet declares Vodafone statements misguided and collusive

Econet Wireless New Zealand (Econet) questions Vodafone’s statement that Telstra’s Tauranga network construction announcement illustrates that further regulation is not required.

“It is collusive and misguided of Vodafone to claim that we don’t need mobile regulation,” says Tex Edwards, Chief Project Director, Econet. “In fact, the only reason investment of this type is being made is because the Government made the correct decision regarding the unbundling of Telecom, and is sending the right signals with regards to the regulation of the mobile market.”

In Telstra’s Wednesday press release it stated, “the regulation announcement changed the view of our Australian shareholder about New Zealand being an attractive place to invest.”

“Econet and Telstra feel confident to invest in the New Zealand mobile market because of the Government’s determination to level the playing field and introduce more OECD style competition law. The natural extension from the unbundling decision for the Government is to fix mobile – the signs are good, but we aren’t there yet.

“Vodafone has a GSM monopoly in New Zealand with 66% of the market, by revenue and traffic, and does not want to see a four player market develop. When you look at many countries similar in size to New Zealand you can see there is plenty of room for four players, and that competition brings strong benefits to the public.”

Econet is calling for a level playing field to be developed by the Commerce Commission in its review of the mobile market. Specifically, to address the behavior of incumbents, who have the power to pocket price and closed network price, and monopolise roaming and co-location provision.

ENDS

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