Telecom resale services may be freed from regulator scrutiny

Friday 25th September 2009

Telecom Corp., New Zealand's largest listed phone company, convinced the Commerce Commission that regulation of its resale services was outdated, raising the prospect that the level of oversight will be reduced.

The commission today announced it will investigate whether to remove or amend regulation of the company’s retail services to wholesale customers, as it had been providing them on “commercial terms without being obliged to” by the regulator.

The final decision on whether to scale back regulation is at the discretion of the Communications Minister. Earlier this year, Telecom requested the commission revisit the regulation, which it claims was surpassed by the enforced operational separation in 2006.

“Regulatory intervention should be scaled back in areas where there is effective competition,” said Telecommunications Commissioner Ross Patterson in a statement.

“There are also a significant number of Telecom’s resale products that have had minimal or no uptake by other telecommunications companies.”

Any loosening of the regulatory burden on the telecommunications company would be the first in some years, and would come on the heels of a report last month by the

Independent Oversight Group, the government and industry appointed watchdog, which found non-trivial breaches around deals offered to retail customers such as Whoosh and CallPlus by the Telecom Wholesale unit.

“The move is a positive step, indicating that the commission is willing to look at winding back regulation once it becomes irrelevant or competition is proven to exist in a market, which is an indication of a maturing regulatory environment,” the company said in a statement.

Telecom was forced to split its network, wholesale and retail services by the previous government amid claims the integration of the company was holding back much-needed investment in the nation’s broadband infrastructure.

Ultra-fast internet is a core plank of the current administration, which has pledged to invest around $1.5 billion over the next 10 years rolling out the new network.

The shares were unchanged at $2.62 in trading today, and have climbed around 14% this year.

Businesswire.co.nz

Comments from our readers

No comments yet