CallPlus OK With Lower Broadband Pricing, But...

MEDIA STATEMENT

CallPlus pleased with Commerce Commission decision to lower pricing terms by Telecom for wholesale broadband but disappointed with size of reduction

CallPlus and ihug's separate requests for reconsideration of pricing terms by Telecom for the supply of wholesale broadband to each ISP, has today resulted in the Commerce Commission amending the price terms. The price of the full speed broadband has been dropped from $27.55 to $26.35 per month.

"Any price reduction ISPs pay Telecom for broadband is a long overdue and a much needed win," says Martin Wylie, CEO for CallPlus Limited. "As a result of our action, we expect Telecom to pass these reductions onto all ISPs. "Once again CallPlus has championed for its Slingshot customers. We battled with Telecom for over a year for access to full speed broadband and eventually the Commerce Commission decided also in our favour, forcing Telecom to make full speed broadband available in 2006."

When Telecom announced its retail pricing for full speed plans in September 2006 it became apparent to CallPlus and other ISPs that by retaining the same retail prices, but changing the service attributes, Telecom was applying a blatant price squeeze on them.

"We had no option but to request that the Commerce Commission review the price terms," Wylie continues. "While we are pleased that the Commission accepted our argument for a price review following Telecoms 'gaming' of the system last year, we are disappointed with today's announcement in terms of the revised pricing methodology. We expected a reduction of $21 to $22 per month, which would make more of an impression in the price ISPs pay Telecom.

"Nevertheless we are taking this small win and now wait for the indication of the price that Commerce Commission will propose for naked DSL and UBA, as part of the standard terms determination process that is underway," concludes Wylie.

ENDS

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