The Commerce Commission has come down heavily on mobile operators. Vodafone and Telecom have both been asked to rethink and submit their mobile termination rates. Mobile termination is the process where the call or text has been handed over to a mobile company to be transmitted to a mobile phone. The rates for the same until now have not been under any regulation. However, an enquiry into this has been conducted and the results show over charging by service providers.

The Commission has to propose whether the rates should be regulated, and how.

The rates being revised and submitted will bring down revenues of Vodafone by at least $50 Mn immediately, and more over a period of time. The company is extremely concerned about these losses, but keeping in mind the Commission’s role, it is adhering to the rules.

Vodafone general manager of corporate affairs Tom Chignell said, "However the commission is both prosecution and judge in this area and, in the interests of concluding what has been a lengthy process, Vodafone has offered this undertaking in line with the commission's recommendations".

In its revised proposal, Vodafone has offered to reduce SMS termination rates to zero if traffic is in balance starting October 1, 2010, and for voice, a reduction by 46% in the first year alone and down to 6 cents per minute by 2014.