This is a sharp reduction from its previous rates, bringing them more in line with upstart provider 2degrees which offers 44c a minute to call any mobile and 9c to send a text. In comparison, prepay rates on Telecom’s XT Network remain the highest at 89c a minute to call and 20c to send a text.

In order to take advantage of Simply Prepay customers must top up online, by phone or at bank ATMs and they are not eligible for on-net deals such as BestMate 1000 and TXT 2000.

In addition, Vodafone has today withdrawn its controversial Talk Add-on plan from the market. The plan enabled customers on certain prepay plans to talk for up to 200 minutes to Vodafone NZ mobiles and landlines for $12 a month.

It prompted ICT Minister Steven Joyce to write to the Commerce Commission and ask it to reconsider its draft recommendation that Mobile Termination Rates – the fee the mobile providers pay to terminate calls on each other’s networks – not be regulated.

Lobby group TUANZ and competitor 2degrees have long argued that MTRs are anti-competitive as they reward dominant telcos for creating cheaper on-net only plans.

The Commission has subsequently released a draft report reversing its original recommendation, and Joyce is expected to make a decision on whether to regulate MTRs soon.