Telecommunications carriers should be responsible for all costs incurred on their own network when providing local number portability to customers, the Australian Competition and Consumer Commission has decided.
Issuing Pricing Principles for Local Number Portability - a guide, ACCC Chairman, Professor Allan Fels, said portability was very important to the development of competition in the local call market.
"Many customers place a high premium on being able to retain their number," he said. "Local number portability allows customers to change their supplier of local telephone calls but still keep their telephone number".
The guide indicates the principles the ACCC will apply if it is required to arbitrate a dispute over the terms and conditions of local number portability between the carrier whom the customer leaves and the carrier receiving the customer.
Today's announcement reflects a change to the approach proposed by the ACCC in the draft guide issued in April 1998. Previously the ACCC indicated that most costs should be borne by the carrier whom the customer leaves. The carrier receiving the customer would, however, be responsible for any administrative costs of a customer 'porting' their number. Since the draft guide the ACCC has come to a view that the carrier receiving a customer should not be responsible for any costs incurred by the carrier that initially provided the local service.
The ACCC's decision will allow carriers to attract new customers without fear of bearing the costs of the carrier from whom the customer transfers.
"No carrier of telecommunications services should be able to hinder the development of competition by loading its own costs onto its competitors," Professor Fels said. "Application of the pricing principles will ensure competition in the provision of local calls will grow.
"Customers will be the winners, as increased competition will force carriers to lower prices and offer a better local call service in order to attract and hold on to their customers.
"This is based on the fundamental observation that in competitive markets, service providers don't recover customer costs from their competitors when a customer leaves their business".
By bearing their own costs of providing LNP, carriers will also have the incentive to adopt the most efficient methods of providing LNP to customers. Lower costs for carriers should lead to lower call prices for customers.
Pricing Principles for Local Number Portability a guide is available from all ACCC offices and will be on the ACCC's web site under telecommunications.
Issuing Pricing Principles for Local Number Portability - a guide, ACCC Chairman, Professor Allan Fels, said portability was very important to the development of competition in the local call market.
"Many customers place a high premium on being able to retain their number," he said. "Local number portability allows customers to change their supplier of local telephone calls but still keep their telephone number".
The guide indicates the principles the ACCC will apply if it is required to arbitrate a dispute over the terms and conditions of local number portability between the carrier whom the customer leaves and the carrier receiving the customer.
Today's announcement reflects a change to the approach proposed by the ACCC in the draft guide issued in April 1998. Previously the ACCC indicated that most costs should be borne by the carrier whom the customer leaves. The carrier receiving the customer would, however, be responsible for any administrative costs of a customer 'porting' their number. Since the draft guide the ACCC has come to a view that the carrier receiving a customer should not be responsible for any costs incurred by the carrier that initially provided the local service.
The ACCC's decision will allow carriers to attract new customers without fear of bearing the costs of the carrier from whom the customer transfers.
"No carrier of telecommunications services should be able to hinder the development of competition by loading its own costs onto its competitors," Professor Fels said. "Application of the pricing principles will ensure competition in the provision of local calls will grow.
"Customers will be the winners, as increased competition will force carriers to lower prices and offer a better local call service in order to attract and hold on to their customers.
"This is based on the fundamental observation that in competitive markets, service providers don't recover customer costs from their competitors when a customer leaves their business".
By bearing their own costs of providing LNP, carriers will also have the incentive to adopt the most efficient methods of providing LNP to customers. Lower costs for carriers should lead to lower call prices for customers.
Pricing Principles for Local Number Portability a guide is available from all ACCC offices and will be on the ACCC's web site under telecommunications.