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| Mobile price benchmarking - "Commerce Commission fixated on...a preconceived conclusion" - Vodafone |
| Posted Sun 11 May 2008 @ 5:55 p.m. by Ernie |
The contentious issue of which Vodafone plans should legitimately be included in the OECD and Commerce Commission price comparisons is back in the spotlight.
A previous clash in this fractious debate seemed to have come to an amicable end just a week ago when TUANZ shouted after work drinks for some Vodafone staff to acknowledge that Vodafone appeared to have justified its claim that New Zealand prices had fallen in relative terms.
But Amy Williams of the National Business Review has now picked up on an acrimonious exchange of letters between Vodafone and the Commerce Commission, and once again we have good cause to wonder. Last week the Commission posted on its site a letter from Vodafone to the Commission making the startling and serious suggestion that the reason the Commission had excluded Vodafone's no frills "You Choose" plan from the pricing calculations was because it was "fixated on ensuring the results...reach a preconceived conclusion that the New Zealand market is not competitive by international standards."
But the Commission's response was revealing. It seems that Commission inspectors visited a number of Vodafone shops and asked specifically about "You choose" plans. It found these plans were not advertised, nor promoted, nor referred to in conversations with staff. When a Commission staff member asked specifically about the Plan he was told that while there are such plans they are not advertised and the salesperson had never sold one - and when the salesperson rang the help desk they also were unfamiliar with the Plan.
On that basis, the Commission advises, it will continue to exclude the plan from its calculations.
Vodafone, according to the NBR, acknowledged that the plan was introduced "after the OECD statistics became an issue" and "...are plans that work well with the OECD benchmarking..."
Vodafone could of course resolve this matter easily if it confided to the Commission the number of subscribers to the Plan and if the number was reasonably substantial. But Vodafone has declined to do so - nor to provide comparative data on similar Vodafone plans in other countries that are, or are not, included in the OECD benchmarking.
Mobile phone costs are a significant part of the cost of living, especially for lower income people. It is entirely appropriate that government agencies monitor them and they are entitled to the reasonable cooperation of service providers in doing so.
One positive outcome is that Vodafone has removed some of the restrictive conditions the Commission had earlier drawn attention to - good on them. But over all, this re-igniting of the issue is not a good look for Vodafone. I have a feeling we have not heard the end of it. |
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| Categories: Regulatory | TUANZ policy | Wireless carriers |
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