Telecom welcomes Commerce Commission recommendations

Friday 17th December 2010

Telecom has welcomed a Commerce Commission recommendation that regulatory requirements should be removed from some services Telecom provides to other telcos to be resold.

Telecom group counsel Tristan Gilbertson said regulation introduced in 2001 requiring Telecom to resell all retail level services to competitors had been overtaken by multiple layers of more detailed regulation, including local loop unbundling.

The current resold service price list extended to more than 6000 items, despite the fact competitors now had regulated access to individual network elements, which enabled them to build their own competing services, making resale regulation in its current form unnecessary.

"With this decision, the commission has recognised the importance of rolling back early interventions in the market, in light of subsequent developments and rapidly increasing competition," Mr Gilbertson said.

"This decision sends an important deregulatory signal to the market at a time when significant investment will be required to deliver next generation fibre access networks."

The commission today said it was recommending that resold broadband services, data services and bundled resale services should no longer be subject to the Telecommunications Act 2001, given the current low take up of the services and the availability of alternatives.

"The commission's recommendation is based on our view that regulatory intervention in telecommunications markets should be scaled back in areas where we consider there is effective competition, or where alternative services are available to access seekers," Telecommunications Commissioner Ross Patterson said.

Resale services provided commercially by Telecom's wholesale division include retail services such as residential lines and broadband services offered to wholesale customers to resell at a discount to the Telecom retail price.

Being subject to the Act means that if wholesale customers are unable to agree commercial terms with Telecom, they can ask the commission to determine the terms and conditions, including price, for supply of the services by Telecom.

NZPA

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