The Minister for Communications and Information Technology, Steven Joyce, has accepted a Commerce Commission recommendation to regulate mobile termination rates.

Joyce says that regulation will improve competition in the mobile market and result in lower prices for mobile phone users.

Mobile termination rates are the wholesale prices charged by a mobile network operator (such as Telecom, Vodafone and 2degrees) for providing services to customers from other network operators.

As part of the Telecommunications Act the Minister is required to make the decision that will promote competition for the long-term benefit of users.

Joyce says that accepting the recommendation meets this test and will lead to lower mobile termination rates and more competitive mobile pricing plans.

“Following today’s decision I look forward to New Zealand mobile users enjoying more competition between operators and better prices.”

The next step is to add mobile termination access services to schedule 1 of the Telecommunications Act by regulation.

The Commerce Commission has since said that decision is expected to take effect in "mid-to late September 2010".

Update: Vodafone has said it’s disappointed about the Minister’s decision to “regulate rather than accept an industry solution” that would have delivered lower mobile termination rates sooner.