ComCom Moves Closer Towards Deregulating Mobile Termination

The Commerce Commission has confirmed it will investigate deregulating Mobile Termination Access Services (MTAS) – which allow customers on one mobile network to communicate with customers on another via voice calls and text messages (SMS) at regulated rates.

“We’ve seen a significant shift in the competitive landscape. This means a formal investigation is warranted, but a recommendation to deregulate will be made only if we find regulation is no longer necessary to promote competition for the benefit of Kiwi consumers,” says Telecommunications Commissioner, Tristan Gilbertson.

Market shifts include the growth in popularity of alternative over-the-top (OTT) messaging services, such as Facebook Messenger and WhatsApp, which potentially negate the need for SMS regulation, and the move towards data services, which potentially negate the need for voice calling regulation.

Confirmation of the investigation follows the Commission’s call for feedback in November last year on its draft decision that there are reasonable grounds to investigate deregulating MTAS.

Mr Gilbertson says that any recommendation to deregulate will be made to the Minister for Media and Communications who will ultimately be responsible for deciding whether the services should be deregulated.

Background

Mobile Termination Access Services (MTAS) are wholesale services supplied by a Mobile Network Operator (MNO), which allow customers on other networks to communicate (either by way of a voice call or SMS) with customers of that MNO.

Before MTAS was regulated, each MNO had significantly cheaper prices for calls and SMS on its own network compared to those going to a customer of a different network. These higher prices hindered competition in creating a barrier to a new MNO attracting customers to its network. In June 2010 the Commission recommended to the Minster of Communications that MTAS be regulated with set prices to even the playing field.

MTAS became designated under the Telecommunications Act in 2010. The Commission is required to consider, at least every five years, whether there are reasonable grounds for commencing an investigation into whether MTAS could be deregulated.

This is a two-stage process with the Commission first looking at whether reasonable grounds exist for a formal investigation and the second looking at deregulation where reasonable grounds exist.

The most recent MTAS review was completed in September 2020 when the Commission concluded that reasonable grounds did not exist.

Separately, the Commission can also initiate, at any time, an investigation into whether MTAS regulation should be altered (if it is satisfied that there are reasonable grounds for an investigation), or review the price and non-price terms that apply to MTAS.

© Scoop Media