RBI prompts Telecom's request for fifth variation to Op Sep

Telco seeks relief on non-discriminatory pricing

Telecom has requested a fifth variation to its operational separation requirements in order to fulfil obligations under the Rural Broadband Initiative.

According to its operational separation undertakings, Telecom Wholesale is required to provide services at non-discriminatory prices. However, Telecom claims under the RBI it will have to do the opposite – provide a lower price to high priority users such as schools, hospitals, farms and marae in a specific geographic area. These are referred to as Priority Rural Telecommunications Services (PRTS).

In his letter to ICT Minister Steven Joyce, Telecom group general counsel Tristan Gilbertson says the telco may choose to provide the same services to customers without using RBI infrastructure and it doesn’t want to be bound by RBI pricing and obligations.

“Neither the Government nor Telecom intends for Telecom to be required to offer those commercial services on the same terms and conditions (including price) as those required by the RBI contract. However, this is a potential unintended consequence of Telecom committing to offering the RBI services on the terms of its existing Undertakings,” writes Gilbertson.

Telecom and Vodafone are currently in negotiations with the Ministry of Economic Development for the RBI. The $300 million contract is expected to be finalised by the end of this financial quarter.

In documents on the MED website it states that the variation request is made in the context of the RBI. “During those negotiations, Telecom and MED noted that unless PRTS were set aside as a separate service under the Undertakings then the non-discrimination rules in the Undertakings would apply and could result in PRTS being offered on a discriminatory basis.”

The government is seeking submissions on Telecom’s fifth variation request by 5pm on April 5. Further information on how to make a submission is on the MED website.

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Tags RBIRural Broadband InitiativeOperational Separation

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