Tuanz threatens action over Telecom Skinny phone locking

Lobby group warns of a possible domino effect with Vodafone, “Telecom proper,” and 2degrees locking in customers. But a high profile analyst defends the right to lock.

The Telecommunications Users Association (Tuanz) is threatening action if Telecom’s Skinny Mobile pushes ahead with its plan to lock phones to its network for nine months.

Telecom is due to launch Skinny Mobile, a pre-paid, low-cost service aimed at the youth market, in the new year.

“Tuanz is opposed to any additional barriers to switching between providers,” the lobby group’s chief executive, Paul Brislen, told NBR.

“The danger is that if Skinny locks handsets then Vodafone and Telecom proper will also jump in, forcing 2degrees to follow suit. It’s better to avoid it at the beginning.”

Mr Brislen said Tuanz had already discussed Skinny’s move with the Commerce Commission and expressed its view that locking a handset to a particular network is anti-competitive.

Tuanz will follow up formally if Skinny goes ahead with locking, either with its complaint to the commission, or a letter in support of the complaint already lodged by 2degrees.

Mr Brislen said the handset locking issue had already been dealt with. In 2008, the Commerce Commission sent Vodafone a letter, warning that a proposed handset-locking policy was anti-competitive. The carrier dropped its short-lived initiative.

“We would have hoped that was the end of it but apparently it will take yet another ruling from the ComCom to ensure fairness for the customers,” said the Tuanz boss.

“We live in hope that the industry will one day realise that these kinds of decisions damage public perception of the industry as a whole.”

Analyst: locking is okay
Not everyone shares Tuanz and 2degrees’ dim view on locking phones to a specific network.

“I don't agree with ComCom's view on SIM locking,” Forsyth Barr research director Guy Hallwright told NBR.

“The idea is to stop customers getting a discounted phone and then taking it to another operator before some ‘contract’ period is up - nine months in this case. [But] if phones are heavily discounted, it's hard to see why the ComCom would object to this practice – it’s just the equivalent of a discount upfront for a fixed-term contract.”

Mr Hallwright added that, “To be consistent, they [the commission] should also object to any form of contract that locks you in for a period - mobile, fixed-line, Sky TV or electricity companies.”

The ForBarr research director noted that across the Tasman, handset locking was the norm, but customers could easily find un-lock codes on the internet.

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