Chorus is reducing the price of its wholesale fibre products over the next three months as well as providing support to retail service providers (RSPs) on doubtful debts they accrued during lockdown.
The reduced pricing and a delayed increase are expected to deliver savings of around $10 million to RSPs, and the lockdown debt package a further $2 million of value.
Gigabit wholesale fibre pricing, Chorus' fastest growing plan, will reduce from $60 a month to $56 a month from 01 July 2020. Gigabit is already Chorus’ fastest growing plan.
The annual regulated consumer price index increase to fibre products will be delayed until 1 October, at which point the price for 100Mbit/s fibre will increase from $46 to $47.15.
Chorus is consulting with RSPs on this change over the next two weeks.
Small business fibre pricing will reduce by $3 a month to $52 from 1 July, acknowledging the pressure SMEs are facing.
The price changes are wholesale only and the decision about passing on either reductions or increases to consumers sits with the RSPs.
Chorus CEO JB Rousselot said the changes struck the right balance of passing on savings to RSPs, while still enabling ongoing investment in infrastructure.
“We are conscious of the critical role Chorus infrastructure played during the lockdown, and we believe this mix of pricing changes will support RSPs, allow Chorus to continue to invest in the capacity, reach and resilience of the fibre network, and also enable more customers to benefit from higher specification plans," he said.
The $2 million debt relief fund was to assist RSPs who elected not to cut off customers who were unable to pay during the lockdown.
“We support the decision some RSPs made not to cut off customers during the lockdown, which in some cases has seen customers’ debt to them grow, potentially resulting in higher than usual rates of non-payment," Rousselot said.
“We have said throughout that Chorus will play its part in supporting RSPs that faced the risk of higher bad debt due to the lockdown,"
The fund represents an estimate of the increased risk of bad debts experienced by the industry, for the period of the lockdown, based on feedback from retailers and other industry analysis.
Chorus isn't the only provider delaying price increases. Cloud accounting company Xero also recently announced an indefinite delay to planned increases in the price of its starter, standard and premium plans that were due to kick in on 1 July.