Consumer and industry groups have launched a new campaign
against a proposed change to internet pricing they say is
effectively a $600 million tax on broadband customers.
Last month, Communications and IT Minister Amy Adams proposed
setting Chorus' wholesale charge for copper line services
between $37.50 and $42.50 a month - the same price as faster
fibre services, and up to $10 higher than the Commerce
Commission's proposal last year.
The move followed complaints from Chorus that setting copper
prices too low could dampen the uptake of fibre being rolled
out as part of the Government's $1.5 billion ultra-fast
A new group opposed to changes, the Coalition for Fair
Internet Pricing, says the proposal is effectively a new tax
on broadband consumers.
The coalition of smaller telco companies, industry groups and
consumer advocates - led by Consumer NZ, Internet NZ and the
Telecommunications Users Association - commissioned an
independent analysis on the changes by economists Covec.
Covec's report, released today, said the policy would
transfer about $600m from firms and households to one
Coalition spokeswoman Sue Chetwin, the head of Consumer NZ,
said it was wrong for consumers to be forced to pay the same
amount for older technology as new technology.
"It's like the Government saying people should pay the same
for dial-up as for broadband, when broadband isn't even
available to them."
She said it was also wrong for Cabinet to set prices for
monopoly services, rather than an independent body like the
"We haven't seen this sort of thing since the 1970s and we
are worried that is an attempt to tax consumers to subsidise
Chorus. We call upon Ms Adams to indicate that she plans to
reconsider her proposal."
Ms Chetwin said the coalition's members supported ultra-fast
"However, under this funding proposal, there would be only
one winner: shareholders of an already profitable monopoly.
The losers would be every household, every small business,
every big business, every farmer, every school and every
student with broadband."
The coalition said it would focus on submissions on the
proposal this week before launching a "comprehensive public
campaign" against it. Submissions on the proposal close
The coalition is supported by CallPlus and Slingshot, the
Federation of Maori Authorities, Grey Power, Hautaki Trust,
KiwiBlog, KLR Holdings, National Urban Maori Authorities, New
Zealand Union of Students' Associations, Orcon, Rural Women,
Te Huarahi Tika Trust and the Unite Union.