Options for fixed line telecoms regulation out for discussion

InternetNZ has welcomed the paper

As part of its review of the Telecommunications Act 2001, the Ministry of Business, Innovation and Employment has released an options paper seeking feedback on its proposed ‘utility-style’ framework for regulating fixed line communications services provided on the ultra-fast broadband network and Chorus’ copper network after 2020.

InternetNZ has welcomed the paper, but says the options canvassed will require careful consideration. The organisation’s CEO, Jordan Carter, said: “The Telecommunications Act affects almost all New Zealanders — its rules are a critical part in setting the cost of broadband services in New Zealand. With Internet access an ever more important feature of people's lives, and vital to New Zealand's economic prospects, it's very important to get these settings right.”

“This review has to deliver a regulatory framework that guarantees fair prices for fast broadband. It also has to guarantee certainty for what these prices will be after 2020. Consumers and businesses deserve nothing less,” Carter said.

He added: "Within the high level announcements, there's a lot of detail needed - and that detail will determine whether the revised Act leads to households spending excessive amounts on broadband, or whether it strikes the right balance in protecting consumer interests. "Major issues we identified earlier were the difficulty in regulating mobile and fixed services and urban and rural services.… We will be interested to see how these issues are taken into account.”

In the paper, the ministry says the current approach was unique to telecommunications, was designed primarily to regulate Telecom New Zealand and the copper network, and is no longer fit for purpose.

Instead the government is looking to utilities regulation using a ‘building blocks’ pricing model (BBM). It says this will benefit end-users through a competitive retail market; prevent monopoly profits and incentivise ongoing efficient investment in high quality networks.

The paper raises a total of 76 questions on which input is sought. Submissions on the options paper close on 19 August. The options paper is available online