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Telecom looks to grow mobile roaming usage

Monday 10th December 2012

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Telecom Corp, which carved out its network unit last year to shed regulatory burdens, wants to boost usage of its mobile roaming services with a new flat fee structure for its post-paid customers.

The Auckland-based company wants to grow its revenue over time by getting mobile customers to use their voice and data services when travelling abroad, chief executive Simon Moutter told a conference call today. Telecom has slashed its data roaming costs for post-paid users, introducing a $6-a-day flat fee in Australia and $10 a day in the UK, US, Canada, China, Hong Kong, Macau, Taiwan and Saudi Arabia.

"We're making a confident judgement that by reducing rates markedly, we will stimulate not just usage by those clients roaming, but by the clients switching those devices off," Moutter said.

Moutter was unwilling to disclose Telecom's global roaming revenue, citing commercial sensitivity. Telecom's voice revenue was $397 million in the year ended June 30, with mobile data revenue of $307 million and other mobile revenue of $190 million.

Telecom didn't release a statement to the stock exchange, indicating the changes aren't material to the group. The shares fell 1.3 percent to $2.255.

The $6 data fee in Australia will be reviewed next year, though it won't be lifted above $10 a day, Moutter said.

Pre-paid voice and data roaming pricing was also lowered, though those customers will still be charged based on how much they use.

The new pricing regime comes into effect on Dec. 21.

The decision comes as Australian and New Zealand regulators look at roaming prices across the Tasman, having indicated both governments expect to see international roaming prices continue to fall.

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