16 Nov 2009

Wholesale of telecos good development - commissioner

1:31 pm on 16 November 2009

The Telecommunications Commissioner has dismissed concerns that the wholesale of Telecom and Vodafone's mobile networks is unlikely to lead to a more competitive market for consumers.

Both teleco companies are pushing the sale of their mobile networks to wholesale customers called Mobile Virtual Network Operators as a way of pleasing the regulators by opening up the market, as well as gaining more customers in an increasingly competitive trading environment.

Some analysts warn it will not lead to true competition because the big firms tightly control margins and will not let serious competitors thrive.

But Telecommunications Commissioner Ross Patterson says he does not agree that is the case, though he will keep an eye on the market.

He says there were greater margins to be earned by building a network and operating a service than are available to a wholesale operator.

But Mr Patterson says there are adequate margins for wholesale operators and they have the ability to innovate in price and provide real competition.