Mobile charges may be fixed

The Commerce Commission is expected to issue a draft report this week that will recommend regulating the fees cellphone companies charge for routing calls and texts to their customers.

The Telecommunications Users Association has blamed the fees for artificially inflating the cost of mobile calls and calls to cellphones from fixed-line telephones.

Third mobile network operator 2degrees has lobbied hard for the regulation of mobile-to- mobile termination fees, arguing that they have been used to dissuade new competitors from grabbing a slice of the $2.2 billion mobile market.

The commission has twice recommended mobile-to-mobile regulation only to be over-ruled by the former government, which instead accepted voluntary reductions offered by Vodafone and Telecom in 2007.

The draft report may provide clues as to the fees the commission would deem reasonable and is likely to trigger a further and final offer by Vodafone and Telecom, as an alternative to regulation.

Given the short average duration of cellphone calls, another key issue will be whether the commission recommends termination charges apply by the minute or the second. Telecom has argued that carriers should pay a minimum of one minute's termination charges for all calls.

Tuanz chief executive Ernie Newman said he was "99 per cent confident" the commission would recommend regulation.

It previously suggested charges be cut to 7 cents a minute for calls and 1c for texts, and this was in line with other countries' charges. ". . . 2degrees needs to know when it comes on stream that the mobile termination system is being repaired."

2degrees will launch its network in August.

- © Fairfax NZ News