Government telco reforms for 2020 include deregulation of copper

Government telco reforms for 2020 include deregulation of copper

Reform package to deregulate copper networks where UFB is available and reduce compliance costs.

A utility-style model of delivery is planned for fibre services by 2020, says Communications Minister Simon Bridges.

A utility-style model of delivery is planned for fibre services by 2020, says Communications Minister Simon Bridges.

As the roll-out of UFB draws to a close, the Government said its contractual arrangements for setting wholesale fibre prices will also fall away. At the same time, demand for new services and capabilities will continue to grow. These changes in technology and market structure need to be supported by a flexible and responsive regulatory regime.

InternetNZ chief executive Jordan Carter said his initial take is that the changes was they represent "a mixed bag for consumers"

"There are some wins for the public here," Carter said. "The new proactive powers for the Commerce Commission, to ask tough questions about the quality of service people can expect, are good to see. There are too many complaints by consumers in the telco sector and it has to change."

On the down side, he said, tweaks and adjustments to the post-2020 framework will see slightly higher copper broadband prices as more money goes to Chorus from users outside the fibre broadband area.

Carter said the Government's proposed 100 down/20 up entry-level fibre product was too slow the last time they proposed it, is too slow today, and will certainly be too slow by 2020.

"The select committee process will be a chance to improve on these decisions by tackling the anchor product challenge, and any other detailed issues that come to light," Carter said.

"All in all, we are pleased to see this review of the Telco Act moving towards a conclusion. The big picture perspective is that this new framework should deliver fair prices for fibre broadband into the future - there are just some further gains we will keep pushing for as the process moves to Parliament and new legislation."

Network operator Chorus welcomed the proposed package, highlighting changes to various valuation methodologies.

“The right regulatory settings for broadband connectivity, which sensibly support efficient investment without costly duplication of utility infrastructure, will ultimately deliver better quality and greater affordability for all Kiwis," Chorus executive Vanessa Oakley said.

“We’ll be taking a keen interest in the next legislative phase of the process which is expected to commence with the introduction of a Bill to Parliament in the second half of 2017.”

Network retailer and mobile operator Spark also welcomed the changes

“Most importantly, the review, and the process to get to this point, has provided certainty to industry providers and their customers of the regulatory settings that will apply to fibre and copper in the period from 2020 onwards," Spark’s general manager regulatory affairs, John Wesley-Smith, said, 

“Giving service providers and network operators a more predictable pathway for the costs we will face from 2020 on will allow us to focus on ensuring we can confidently invest to bring the best of new products, services and innovation to New Zealanders."

Wesley-Smith acknowledged the industry still has work to do on service quality, adding Spark had put a huge amount of effort into addressing the area at Spark and is continuing to do so.

Telecommunications services have become much more important to everyday life and business in New Zealand, and the current regulatory settings needed to be refreshed, Bridges said.

“We have heard from a range of parties as proposals have been developed, and have listened to feedback we received, making a number of changes."

Overall, the Government said, the new regime aims to ensure UFB providers cannot make excessive profits at the expense of consumers yet can achieve reasonable rates of return from ongoing investment.

Earlier this month, the Government's extension to its original UFB roll-out commenced in Northland and on the West Coast.

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Tags regulationTelecommunicationsADSLtelcoscopper networksUFBCommerce Commissionultra-fast broadband



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