ComCom RUBS Telecom up the wrong way

TelstraClear wins regulated access, but Telecom will challenge determination

After over a year of bureacratic and legal wrangling, the Commerce Commission has issued its final determination on TelstraClear’s application for a Regulated Unbundled Bitstream Service (RUBS).

This is, says TelstraClear head Alan Freeth, a positive step forward, but adds that the regulated service isn’t real broadband as it is capped at 128kbit/s upstream. Due to the slow upstream, the download speed of RUBS will be limited to 3.5–4Mbit/s under ideal conditions. This despite the determination stating that Telecom should supply RUBS with a download speed up to the maximum technical capacity of the DSLAM that customers connect to. Currently, this is 7.6Mbit/s.

Freeth is not sure when TelstraClear will start to resell RUBS. He expresses disappointment that it has taken over 13 months to finalise the determination, during which TelstraClear has not had a DSL service to resell.

CallPlus co-founder Annette Presley is also less than impressed with the time it has taken to reach a decision.

“Even if the Commissioner’s determination goes unchallenged in the courts it will be June 2006 before anyone has access to the service. However, it is more likely that in April 2006 we will again see Telecom go to the courts to get the decision overturned, further frustrating and delaying the process” says Presley.

According to an unnamed industry source, Telecom has already booked an April court date for challenging the determination.

Immediately after the Commerce Commission released the final RUBS determination, Telecom announced that it was likely to challenge the decision. This would be either through an appeal or by continuing the judicial review proceedings it launched earlier, according to the telco’s general manager of industry affairs and government relations Bruce Parkes.

To speed matters up, Telecom “allowed” the Commerce Commission to go ahead with the RUBS determination instead of continuing proceedings in the high court for a judicial review of the pricing principles. In return, the Commission guarantees a prompt hearing for Telecom if the telco needs to challenge the determination.

Telecom didn’t comment when asked if it would offer a service equivalent to RUBS for other providers, or if it would change its retail and resale offerings to match.

The wholesale price for RUBS is set by the Commissioners at $27.87 plus GST a month, for a service that doesn’t distinguish between customer type or speed. This means the residential and business variants of RUBS will carry the same wholesale price from Telecom.

TUANZ chief executive Ernie Newman is upbeat about the uniform price, and says that it is for resellers to decide on and deliver different service packages for the various markets.

Telecom’s Parkes says the flat-rate price is an increase on the cost for entry-level plans and will likely make low-speed customers worse off in the long run. The spokesman for internet providers association ISPANZ, David Diprose, notes that price for RUBS has gone up from the draft determination and with GST added, is above the government’s $1 per day for broadband target.

Diprose also says RUBS remains heavily constrained with a 128kbit/s uplink and a downlink that is allowed to degrade to lower than dial-up speeds during busy times. This, Diprose says, reinforces his view that the government needs to urgently reconsider and unbundle the local loop, a view shared by TUANZ’s Newman.

TelstraClear’s Freeth also says unbundling is the way forward, and calls upon minister of communications David Cunliffe to quickly review the regulatory environment for that reason.

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Tags UBStelecomTelstraClearCommerce Commission

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