Telecom ordered to exchange calls at cost

The Commerce Commission today confirmed its preliminary decision in June that Telecom and Vodafone should exchange local calls at no charge to either company.

The decision is seen as a win for mobile phone company Vodafone in its bid to set up a new service that would enable customers to use the same phone for local and mobile calls.

In January, Vodafone applied to the commission for a determination requesting access to interconnection with Telecom's fixed PSTN (Public Switched Telephone Network).

That would enable carriers to exchange call traffic between each other's networks, so customers of one network could call customers on the other carrier's network.

"The commission's conclusion is that Telecom and Vodafone should exchange local calls at a reciprocal price of zero in accordance with the 'pure bill and keep' pricing method," the commission said.

Vodafone needed the agreement to launch a service under which customers would be allocated a local number, and could make or receive local calls on their mobile while within a set area surrounding their home or business.

Customers may, as an additional service, be able to receive calls to their local number while outside their homezone.

Today's determination covers only voice calls to or from local numbers. It does not cover calls to and from Vodafone's mobile numbers.

Telecom would also not be able to charge its customers a higher price for calls to Vodafone local numbers, compared to the price charged for other local calls made by its customers.

The move is seen as a way of allowing Vodafone access to Telecom's fixed line business. It would use hybrid phones now coming onstream that could be used both as a portable home phone and, elsewhere, as a cellphone.

Interconnection is the service where telcos exchange call traffic between each other's networks, enabling customers of one network to call customers on the other carrier's network.

- NZPA