Phone+broadband = high bills

JOSH MARTIN
Last updated 12:24 23/12/2013

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New Zealand households' internet and phone bills continue to be substantially higher than those in comparable countries, an international study by the Commerce Commission has found.

The commonly combined package of a home phone line and 60 gigabytes of data is still more than 30 per cent higher than the OECD average, despite New Zealand prices dropping 14 per cent in the past year.

High-data, high-speed internet users are the most overcharged group, relative to their worldwide peers, with 150GB fast-fibre internet and phone bills 50 per cent higher than OECD benchmarks and 38 per cent higher than Australian households.

Even on slower DSL cable services, phone and 150GB internet packages were 24 per cent more expensive than the OECD average.

Pricing for internet data bought without land line phone services, called naked broadband, with average data use was more competitive in New Zealand, the commission said.

Customers who chose a 60GB internet plan with a cellphone contract and no home land line paid 4 per cent less than the OECD average, after dropping 41 per cent in two years.

Phone-line charges, which covered line rental and a basket of 60 calls including local, international and calls to mobile phones, were 43 per cent higher than the OECD average, the commission found.

"New Zealand's residential basket prices are considerably higher than the OECD average for an average amount of calling, with New Zealand being the worst in the OECD for the 60 calls basket," the commission said.

"However, competition from mobile and other services appears to have stopped Telecom from further raising its standard residential line rental, which has stayed at $50 a month since June 2011," the commission said.

Telecom's introduction of unlimited national calling for $10 meant the standard line rental price in that group had reduced by a third, to 4 per cent under the OECD average. 

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- Fairfax Media

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