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Chorus faces four months of price pain

Posted on 2014/06/14 at 09:16:35
Posted in: chorus

Infrastructure company Chorus will have wear lower wholesale broadband prices for at least four months after regulators pushed back its final pricing review until April next year.

The Commerce Commission is undergoing a review of two sets of prices for copper wholesale broadband services. These are the prices Chorus charge internet retailers such as Vodafone and Orcon, who then onsell services to customers.

Initial decisions from the commission cut what Chorus charges for these services by 23 per cent, which the infrastructure company last November said would hit its earnings before interest, tax, depreciation and amortisation (ebitda) by $142 million per annum.

The new prices come into effect from December this year.

Chorus, which is rolling out the lion's share of the Government's fibre-based ultra-fast broadband scheme, requested a wider review of both sets of prices from the Commission (known as a final pricing principle review).

Although the regulator was aiming to have both of these reviews completed by the time the price cuts come into force, the commission today said it aims for a draft decision on both sets of prices by December and a final decision by April 2015.

"While the Commission announced in March that it intended to produce a draft determination by August and complete a final decision by 1 December 2014, it has decided to change that time frame to allow for matters raised in the submissions from Chorus, Telecom, Vodafone, Callplus, Orcon and internet NZ," the regulator said this morning.

Chorus said it was "very disappointed" by today's news.

"While we acknowledge the FPP processes are challenging, we are very disappointed that the timetabling aims announced by the Commission in February have now been changed," said Chorus general counsel Vanessa Oakley.

"We agreed with the Commission's statements in March that prompt completion of those processes provided the best certainty for everyone. We also believed that appropriate levels of consultation could be undertaken within the original timeframe".

Although the lower wholesale prices will come into effect in December, Chorus said there was a precedent for backdating any change in the prices announced in its final April 2015 decision.

Advocacy group internetNZ said it welcomed the Commerce Commission's "sensible decision to extend the copper pricing consultation" and said it will provide a better result for Kiwi consumers and businesses alike.

Chorus under pressure to make all towns ‘gigatowns’

Posted on 2014/06/14 at 09:15:49
Posted in: chorus

Press Release – New Zealand Labour Party

The heat should be put on Chorus to extend its #Gigatown prize to all communities where it is laying out state-funded fibre following moves by another provider to offer its own gigabit speed service, Labours ICT spokesperson Clare Curran says.Clare

CURRAN

ICT Spokesperson

12 June 2014 MEDIA STATEMENT
Chorus under pressure to make all towns ‘gigatowns’

The heat should be put on Chorus to extend its #Gigatown prize to all communities where it is laying out state-funded fibre following moves by another provider to offer its own gigabit speed service, Labour’s ICT spokesperson Clare Curran says.

“UltraFast Fibre’s announcement of ‘gigabit’ services to eight towns across the central North Island confirms Chorus’ social media #Gigatown competition is nothing more than just a cynical public relations exercise.

“The initiative also raises questions around low take-up of the Government’s Ultrafast Broadband (UFB) programme and the ongoing saga of Chorus pushing for higher prices on copper to protect its profit base.

“Why, for instance, is UltraFast Fibre able to offer a gigabit service to eight towns in the central North Island while Chorus, the biggest provider of the fibre rollout, is forcing communities throughout New Zealand to compete amongst themselves?

“Ultrafast Fibre is offering a residential 1 gigabit per second (Gbps) broadband service across its network from next month.

“By contrast, Chorus has been pushing local councils around New Zealand to fund social media promotions of its #Gigatown competition where one town will win three years access to a wholesale gigabit service plus a $200,000 innovation fund.

“There has been growing concern around #Gigatown, with criticism that it is costing councils’ money despite little likelihood of a return to their communities; that there would only be one winner, and that the winning community would only be able to access the service subject to a retail service provider coming on board, along with other factors outside the community’s and Chorus’ control.

“Labour applauds UltraFast Fibre’s initiative to offer a higher grade service. It fits with our philosophy that every community throughout New Zealand should be a ‘gigatown’.