We're changing without 'big stick' - Telecom

Telecom says changes introduced last December had resulted in a spike in roaming data use during January. Photo / Thinkstock

Telecom says the threat of regulation on roaming charges will not change its plans for more changes to rates for its customers travelling overseas.

The company's head of mobile roaming Niki Chave said she was pleased price cuts had been acknowleged by Prime Minister John Key in the warning of price caps following a summit with his Australian counterpart Julia Gillard at the weekend.

Chave said Telecom had a sense the warning was coming but "the potential regulatory activity that might fall out of it won't change what we are doing.

"We were doing this well in advance of the big stick. We're going to continue to change."

The company slashed its roaming charges across the Tasman late last year, introducing a $6 a day flat rate for data roaming in Australia, for contract customers and $10 a day in other key markets including the USA, UK and China. Vodafone and 2degrees have also cut charges.

Chave said across the Tasman the three telcos had been slow to cut their roaming rates.

She said the changes Telecom introduced last December had resulted in a spike in roaming data use during January, traditionally a quiet time with less business travel.

Telecom was working to extend the discounted fixed rate roaming charges to other markets, including Japan and South Korea.

At the time of the $6 deal announcement last year, the company said it could not rule out price increases in Australia. Chave maintained that stance today but said it was hoped that some rates such as those in the United States could be cut.

Telecom's small size compared to other telecos around the world meant it did not have the negotiating power of big global players.

Revenue figures for Telecom roaming are not disclosed but she said it was not a particularly big earner for Telecom, likening it to a corner dairy compared to the supermarket-size total mobile business.

Following the Key-Gillard meeting, Communications Minister Amy Adams confirmed authorities on both sides of the Tasman will also have the power to demand that telecommunications companies offer local access that does not force the traveller to buy a local sim card.

"They will collect, benchmark and report that publicly and they will be given the ability to intervene in the market in a series of ways, including setting price caps if they think it is necessary or requiring operators to offer local access services that don't require you to buy a local sim card."