CallPlus disappointed by draft ruling on network fee

4.40pm

Telecommunications company CallPlus is disappointed the Commerce Commission has not ruled on the fee Telecom can charge to carry national calls.

Telecom is likely to be able to charge CallPlus 1.13c per minute for use of its network, the Commerce Commission said in a draft determination released today. That is in line with what Telecom can charge TelstraClear.

However, the commission indicated it was not able to determine the price of the transport component of the call between toll boundaries.

The interconnection price is the charge payable by one carrier to the other for handling calls between the two networks, including the local end of toll calls, toll free calls and fixed to mobile calls.

CallPlus corporate director Brook Paterson said that while the company agreed with the 1.13c per minute interconnection fee, it was "very disappointed" the draft determination excluded the price Telecom can charge for carrying national toll calls.

Telecom currently charges second-tier carriers such as CallPlus both an interconnection price and a considerably higher charge for carrying their calls on its backbone network.

"We believe that national toll calls are covered by the (Telecommunications) Act, and the commission has determined they are not covered," Mr Paterson said.

Earlier this year Telecom raised the long distance carrying charge to more than 7c a minute from 4.5c.

"The majority of cost involved delivering a call is to do with the hand-over of a call from one party to another. The actual carriage up and down the country is a trivial cost.

"We can deliver calls to international destinations from Auckland cheaper than we can deliver a call to Wellington on Telecom's network," Mr Paterson said.

CallPlus, the fourth-largest telecommunications company in New Zealand, provides telecommunications services to predominantly residential customers, and small and medium businesses.

CallPlus applied to the commission in December for a decision on interconnection and resale services from Telecom.

The Commerce Commission is now calling for submissions from interested parties on its draft determination by 18 July and intends to hold a conference shortly afterwards.

The commission has deferred consideration of the wholesale element of CallPlus' application, covering the resale of services purchased from Telecom, until August while negotiations continue.

Telecom shares last traded down 1c at $5.12.

- NZPA