Telecom is in regulatory hot water for allegedly favouring its retail ISP Xtra over wholesale providers when provisioning broadband for customers.
Brendon O’Connor of Bryndwr, Christchurch, laid a complaint with the Commerce Commission after applying for Ihug’s Bliink broadband service for himself and a friend.
According to O’Connor, the Commission initially declined to look into his complaint and would not pass it on to telco commissioner Douglas Webb. After approaching the Commission a second time and telling it that Computerworld was covering the story, O’Connor was told that his complaint is being taken seriously and looked into.
Sarah Boggs at the Commission’s contact centre indicated to O’Connor that his was not an isolated incident and that it was aware of other customers being turned down. However, the Commerce Commission did not respond to Computerworld’s calls for comment before going to press.
When he applied to move his broadband connection in April this year, O’Connor says that even though he already had Xtra Jetstream DSL on his line, Telecom turned down Ihug’s application without giving a reason why.
It took over two months for O’Connor to get the Ihug service on his line but an acquaintance, Mark Winter of Burwood, Christchurch, was less succesful. Again, Telecom turned down Ihug’s application for broadband on Winter’s line on August 26, claiming that there was no capacity left in his area according to O’Connor.
However, a few days after Ihug’s application for broadband on his line was turned down, Winter applied for service from Telecom Xtra which provisioned it for him on September 2.David Diprose, Ihug’s general manager of industry and regulatory affairs and spokesman for the newly formed Internet Service Providers Association of New Zealand, says that O’Connor’s application was turned down by Telecom as it was wrongly listed as a new Unbundled Bitstream Service (UBS) connection.
O’Connor says that he used Ihug’s online application form and stated on this that he was an existing “churn” customer and thus the connection should be transitioned. Diprose says that Ihug can’t have been made aware of this, as it filed an application for a new connection.
Asked if Telecom nevertheless would know that there was Xtra DSL connected on O’Connor’s line, Diprose agreed but says that unless Ihug has the UBS connection 100% correct, it will be rejected. Ihug is then left to identify the problem and resubmit the application without really knowing why it was rejected in the first place.
The reason it took such a long time for O’Connor to find out what went on was due to Ihug sending him notification emails which he couldn’t read as his Bliink account could not be activated due to Telecom’s rejection.
As for Winter’s case, Diprose confirms Ihug’s application for broadband was rejected but says Telecom gave no reason for rejecting it. He adds that Telecom “occasionally exhibits a lack of parity between wholesale and retail with examples like this.” Labelling these “disappointing and frustrating” for Ihug and its customers, Diprose says the incidents where Telecom decline to provision UBS for the ISP but sets it up nevertheless via Xtra are isolated.
Diprose says there is no way for Ihug to validate Telecom’s rejections unless the customer goes on to apply for retail Xtra service.
Telecom is also under government scrutiny as it looks likely to miss the self-imposed target of a third of all broadband connections being sold through third-party ISPs retailing its wholesale service. That target was one reason why the government decided to not unbundle Telecom’s last-mile network and dismantle its monopoly as happened in other OECD countries. Telecom did not return Computerworld’s calls.