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They high prices have also stifled mobile usage in New Zealand. Just last week the Commerce Commission issued its annual report saying "[Mobile phone] usage remains low by international standards. New Zealanders make an average of 79 minutes of calls per month compared with 120 minutes per month in Australia and 198 minutes per month in the UK."
After a protracted investigation and on the strength of promises by the operators to progressively reduce their MTAS prices the Commission had decided not to regulated, but it changed its mind in May last year after Vodafone NZ introduced a new tariff with a huge differential between on-net and off-net calling rates.
The Commission has mandated termination rates for voice of 7.48 cents per minute immediately reducing in four six monthly stages to 3.56 cents on 1 April 2014. The Commission said it "considers that a glide path is appropriate in order to allow operators time to adjust retail prices'¦and'¦over the long term, this will best promote competition." This view was not unanimous: one of the three commissioners advocated immediate reduction to 3.56 cents. The price for terminating text messages has been set at 0.06 cents, effective immediately.
The prices are well below what operators are currently charging and below the phased reductions they had initially offered, and which had contributed to the Commission's initial decision not to regulate.
In mid 2009 Telecom NZ offered to decrease rates from their then current rate of 15 cents per minute to 7 cents per minute, but offered no reduction in its 3.5 cent fee for SMS termination. Three months later with the threat of regulation growing all the carriers submitted better offers: Telecom NZ proposed a zero fee for SMS termination. TUANZ opposed this on the grounds that it could encourage spamming.
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