Commission to investigate lack of mobile co-location

An investigation is to be launched into the lack of equipment co-location in the mobile telecommunications industry.

Co-location involves network operators installing equipment on another operator's tower, and is seen as a way of reducing costs associated with establishing cell sites.

But according to the Commerce Commission fewer than 0.5 per cent of available towers in this country have co-location on them, despite co-location agreements being in force for many years.
It said today it proposed to start a process early next year, with a view to developing a robust co-location regime.

Co-location prices should not be regulated as issues preventing effective co-location were not related to price, the commission said in a recommendation to Communications Minister David Cunliffe.

It would closely monitor co-location prices and act quickly if problems did emerge for access seekers.

The commission also recommended that a so-called undertaking from Vodafone, with the company's proposals for co-location, should not be accepted.

The undertaking lacked targets or timeframes and was unlikely to promote entry into the mobile market, the commission said.

So far, a lack of targets and key performance indicators, and robust implementation plans had created significant barriers to entry.

There appeared to be no or limited incentives to support co-location on reasonable terms for competing cellular networks, the commission said.

It considered co-location would help remove entry barriers to the mobile industry and improve competition in the retail mobile services market .