Telecom says it is prepared to sacrifice some data roaming revenue by slashing prices in the short term in order to stimulate demand.
From 21 December Telecom will introduce a flat daily rate on its smartphone plans instead of charging data on a usage basis.
Those travelling to Australia will pay $6 a day until the end of June, when Telecom will review the rate, while users will pay $10 a day for data in the UK, North America, China other parts of Asia and Saudi Arabia.
The company says data roaming charges will be slashed by 83 - 92% in other markets, although charges will continue to be on a usage basis.
Voice roaming charges will fall in some cases, with Australia cut by a third, while pre-pay customers will also experience savings.
Telecom chief executive Simon Moutter says firms could save tens of thousands of dollars every month after the phone company cut data charges for those using their phones while overseas.
He concedes it will cost it money, but he's hoping the lower and simpler prices will encourage greater use in the longer term.
The company's stock fell 2 cents to close at $2.26 on Monday.