Curran opposes Chorus proposal

Clare Curran.
Clare Curran.
Labour MP Clare Curran is calling for the Commerce Commission to reject a suggestion by Chorus it offer its own pricing analysis to speed up the decision on copper wire prices.

Chorus, the telecommunications network operator spun out of Telecom in 2011, yesterday put an alternative proposal to the Commerce Commission on how its physical copper lines should be regulated in a bid to fast-track the process.

The Wellington-based company says the regulator should use the existing network configuration as a hypothetical equivalent operator to determine the value of assets and level of operating cost at their current replacement cost, rather than using fibre-only and fibre/wireless as equivalents.

Ms Curran, Labour's associate ICT spokeswoman, said it was an issue of trust and New Zealanders were already wary of Chorus.

''The company does not have a great track record for efficiency or competence when it comes to rolling out the ultrafast broadband network.''

Chorus made the proposal as a submission on the commission's work to set a final price for what the network operator could charge for services on its copper lines, to find the true cost of the service rather than relying on international experience as a benchmark.

The review was broken into two parts.

The regulator sought views on how to set the methodology in valuing the unbundled copper local loop (UCLL) service, which lets retailers rent the lines for voice and broadband services.

The second part related to the unbundled bitstream access (UBA) service, which gave internet service providers access to the network company's electronic switchgear on the copper lines.

Chorus also supported aligning the timetable for the UCLL and UBA processes to ensure the final pricing principle can be set by December this year, when the company is expected to adhere to the new regulated prices.

Last year, the Commerce Commission proposed cutting the network operator's pricing on its copper line services, which Chorus says has left a $1 billion hole in the funding to finance rollout of the Government-sponsored ultrafast broadband network.

Ms Curran said any recommendations Chorus made which involved ''trust us to come up with the right answers'' should be regarded with scepticism.

''The bottom line for the commission is clear. Affordable prices for consumers, a competitive industry and an efficiency network in copper and fibre. If Chorus can't deliver those things, then they're in the wrong game,'' she said.

Chorus is negotiating with Crown Fibre Holdings over the building of the network, but Communications Minister Amy Adams has indicated the Government expects the company to fill most of the $1 billion hole.

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