Fibre study to get ready for new policy structure
AUCKLAND: The Commerce Commission is launching a formal study into the country’s fibre services to get a better handle on the nature of New Zealand’s networks and operations in anticipation of a new policy framework now being considered by legislators.
Telecommunications Commissioner Stephen Gale on Friday announced the study under the Telecommunications Act, which lets the regulator investigate any industry matter or the longterm benefit to consumers.
The commission wants to start gathering information from Chorus and the local fibre companies to help it get ready for the new regulatory framework to be set up by the Telecommunications (New Regulatory Framework) Amendment Bill.
Parliament’s economic development, science and innovation select committee is scheduled to report on the Bill next week.
The duration and scope of the study will depend on when the Bill is passed, and the regulator expects to gather information on assets and capital spending on fibre networks, operating costs, quality dimensions of fibre services, and products, pricing and revenues of fibre services.
The Commerce Commission will hold an industry workshop on Wednesday on how fibre will be regulated in the future and will provide more information about the study then. The regulator will publish a summary of its findings at the end of the study.
Legislators are reviewing a Bill proposing a new regulatory regime for fibre networks, applying a similar pricing methodology to energy networks and airports.
The previous government launched a review of the existing law in 2015 to gauge the crossover with broadcasting and to have a look at the way network service pricing was regulated, after Chorus underestimated the extent it would have to cut wholesale prices when it was carved out of Telecom Corp, now Spark New Zealand.
The new regime also seeks to improve the information available to consumers, imposing greater oversight of the development and maintenance of consumer codes and empowering the Commerce Commission to act if those guides are inadequate.
The lobbying took a late turn last month when Vodafone New Zealand chief executive Russell Stanners wrote to the committee after delivering his oral submission, accusing network operator Chorus of a ‘‘cynical move’’ to hike the price of a service likely to become an anchor broadband service before the price was locked in.
In an interview earlier this month, Mr Stanners said the lack of competition in fibre meant the local fibre companies had not invested in upgrad ing the speed of the networks, opening the way for wireless technology to be a viable alternative.
‘‘What we’re saying to the Government is you need to make sure there are incentives on these guys because at the moment there’s a danger of having the best new fibre network overtaken by wireless,’’ Mr Stanners said.
‘‘That’s why the current review is a big step — it’s an inflexion point where the Government can continue to build a successful model or watch while it withers on the vine.’’
A key element to Vodafone’s formal submission is for strong incentives to innovate over the ultrafast broadband network, with unbundling to allow direct access to the fibre central to generating competition.
Rival retailer Spark New Zealand’s submission generally sought greater restrictions on network operator Chorus and urged an easing of retail regulations. Two Degrees Mobile supported the thrust of the Bill but said it was concerned about locking in the advantage to monopoly fibre suppliers over the supply of nonfibre services and that it was concerned about access to terms to dark fibre access services that feed into nonfibre services.
While Chorus supported the Bill, it suggested faster deregulation of its existing copperline services and more flexible legislation to allow for new technologies and service providers getting fibre access. — BusinessDesk