Ministry Conclusions and Comment
79. Although there are some limited services on which New Zealand compares favourably with other OECD countries, in general there is a significant gap between New Zealand pricing performance and that of countries in the top half of the OECD.
80. Following the updating of the OECD fixed telephone services benchmark baskets to include significantly larger amounts of fixed-to-mobile calls New Zealand's relative performance deteriorated from ~18th (as at August 2005) to ~24th.
81. New Zealand's relative cellular service pricing performance was based on Vodafone plans that require a three year commitment. The use of such plans in price benchmarking is questionable and the Ministry intends to take this issue up with the OECD Secretariat with responsibility for OECD telecommunication service price benchmark methodology.
82. Broadband service pricing developments and uptake continue to be mainly focused on services that have a maximum upstream speed of 128 kbps.
83. Advanced residential and small business user broadband telecommunications services with an extensive geographic coverage are becoming more widely available in a number of OECD countries.
84. At present advanced broadband service packages for residential and small business users are not generally available in New Zealand.
85. Point-to-point data transmission links are continuing to decline in importance with the development of cost effective IP based data services. The Ministry intends to develop a satisfactory replacement methodology for benchmarking the equivalent IP based point-to-multipoint data services and discontinue the use of the point-to-point leased line data service benchmark.
86. There is an ongoing need to benchmark New Zealand's performance relative to other OECD countries in delivering existing telecommunications services at cost based prices and promptly providing new and improved services. It is likely that the Commerce Commission will undertake some form of telecommunications services benchmarking under the sector monitoring provisions of the Telecommunications Amendment Act. The nature and extent of future benchmark reporting by the Ministry has yet to be decided.
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