Telcos call for Crown Fibre Holdings to be scrapped

UPDATED: view the leaked letter to Amy Adams; ICT Minister told that CFH is delaying deals

New Zealand top telecommunications firms have written secretly to Communications Minister Amy Adams calling for the Crown-owned company overseeing the Government's $1.3billion investment in ultrafast broadband to be sidelined or scrapped.

Telecommunications Carriers Forum chief executive David Stone wrote to Adams on Monday on behalf of Telecom, Vodafone, CallPlus, 2degrees, Chorus, Wel Networks, Northpower and several smaller telcos, saying Crown Fibre Holdings was delaying deals that need to be made before UFB can be offered to customers.

A copy of the letter, which was leaked to The Dominion Post, said the companies wanted the UFB network to be a success, but were unanimous that Crown Fibre's role needed "adjusting to reflect a more narrowly defined mandate".

However, it went on to say that Crown Fibre's "remaining minor roles could easily be managed by an existing government department".

Adams confirmed she had met with several industry representatives and that some had asked her for "further clarity around the roles of the agencies involved in the rollout of ultrafast broadband".

"Officials are looking into this matter for me," she said.

The forum represents all the major telcos. Stone wrote that they were surprised at the way Crown Fibre had been intervening in commercial arrangements between the four companies building the UFB network – Chorus, Wel Networks, Enable and Northpower – and retail providers that would sell fibre-based services to customers.

"With a few minor exceptions, Crown Fibre's interventions have not been helpful and have delayed commercial arrangements," he wrote.

A Crown Fibre spokesman said more than 20 retailers had agreed to wholesale ultrafast broadband at least on trial.

The telcos argued that Crown Fibre had completed its job of awarding contracts to build the UFB network, should not act as a "quasi-regulator" and had proved to have no role negotiating equipment supply contracts for the network.

Nor would it be useful for Crown Fibre to promote the UFB network as the Government already had "numerous initiatives" to drive uptake and awareness, they said.

Crown Fibre employs eight staff and paid $2.8 million in salaries and directors' fees last year.

TCF CEO comments

Stone commented to Computerworld about the leaked letter: “This is an issue that is of concern to the industry and it is legitimate for the industry to raise its concerns with the Minister, but it (the letter) was intended for the Minister, not for the public.”

Click on the icon below to view the leaked letter (pdf).

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