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Kiwi Share Reform "long overdue"25 December 2005
Media Release
22 December 2005
Kiwi Share Reform "long
overdue"
Mobile operator Vodafone today called on the
government to move ahead with what it called "long overdue
reforms" to the Kiwi Share arrangements.
"The Kiwi Share
is now hurting the very customers whose interests it was
designed to protect and the time has come for a major
overhaul," said Vodafone Finance Director David
Sullivan.
Vodafone was responding to today's announcement
by the Commerce Commission that it would have to subsidise
fixed-line operator Telecom to the tune of $9.5 million for
the period 2003/04, for losses on some of its "commercially
non-viable customers".
"As a mobile-only operator, we
don't think it's reasonable for us to have to subsidise
Telecom's provision of fixed-line services. Vodafone would
like the opportunity to compete rather than prop up the
competition - and we believe customers in regional New
Zealand deserve real choice."
Sullivan called on the
government to support a "Three Point Plan for Regional New
Zealand" to promote competition in telecommunications
services. He said such a plan should include:
1. Immediate
disclosure of the general location of the customers which
Telecom claims are "commercially non-viable";
2. Agreement
to initiate a wide-ranging review of the way
Telecommunications Service Obligations are provided; and
3. An in-depth audit of the quality of telecommunications
service being experienced by regional New
Zealand.
Vodafone will continue to advocate policy changes
that will provide consumers with greater choice in
telecommunications. A Parliamentary Select Committee will
be hearing public submissions on a new Telecommunications
Amendment Bill during 2006.
Note to editors:
The Kiwi
Share is a private contract agreed in 1990 between Telecom
and the Government. Under this agreement Telecom agreed to
continue to provide local residential phone services to all
existing customers, not to increase the standard monthly fee
by more than the rate of inflation, and to continue to offer
unlimited local calls for no charge beyond the monthly
fee.
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The agreement was revised in 2001 to include the
provision of slow-speed dial-up internet to most Telecom
customers and incorporated into legislation as a
Telecommunications Service Obligation. This incorporation
had the effect of forcing Telecom's competitors to
contribute to the losses that Telecom makes on customers who
are "commercially non-viable", i.e., customers who generate
revenues less than the costs of serving them. The amount of
these losses is estimated annually by the Commerce
Source: scoop
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