Vodafone decries recommendations

Vodafone has slated the Government's telecommunications inquiry for recommendations it says would discourage investment because they are out of step with New Zealand's free-market approach to commerce.

In an impassioned address, Vodafone chief executive John Rohan decried the recommendation that cellular incumbents be forced to provide cellular roaming to their networks from new entrants.

"Mandated roaming would almost never be considered in any other industry because it is the equivalent of telling a manufacturer that it must let a competitor use its factory," Mr Rohan said.

"We are deeply concerned that the inquiry isn't even doing the economic work to establish whether their recommendations would result in better prices, better services and more satisfied consumers."

At an industry summit sponsored by the Telecommunications Users Association, Mr Rohan said the recommendations were likely to do nothing for the consumer because they would stifle investment in new technology and move value from existing players to new fly-by-nighters.

Vodafone has invested more than $1 billion in the New Zealand market since it took over BellSouth 20 months ago, and Mr Rohan said the benefits of competition and lower prices resulting from its entry had brought New Zealand's once-lagging cellular penetration close to British and Australian levels.

He estimated that 42 per cent of the population had cellphones, up from 17 per cent when Vodafone entered the market.

Predictably, Clear Communications chief executive Tim Cullinane supported many of the inquiry's draft recommendations, but reiterated his company's call for unbundling of the local loop (which would give Clear direct access to Telecom's copper) as the best way of bringing broadband services to consumers. That position was not endorsed by the inquiry.

But while Telecom also supported many recommendations, chief executive Theresa Gattung opposed the idea of an industry regulator, worrying it could lead to the regulator becoming prosecutor, judge and jury in its own right.

Meanwhile, Telstra Saturn, whose $1.2 billion investment intentions are of similar order to Vodafone's, was ardent in support of the bulk of the inquiry's recommendations.