The government has put its faith in Telecom's promises of a broadband future and decided to accept the telecommunications commissioner's recommendation not to unbundle the local loop.
Communications Minister Paul Swain says part of the reason for his decision was to speed up the delivery of competitive broadband services to New Zealand consumers.
"If I had sent the recommendations back for further consideration, there was likely to be considerable delays to broadband competition, frustrating this government’s goal of encouraging growth and innovation.”
The recommendations to be implemented are:
§ “bitstream”access to Telecom’s wires at a level of 128Kbps upstream/256 Kbps downstream
§ the offer by Telecom to provide unbundled partial private circuits (UPC) be given six months to be implemented commercially. If there were no suitable outcome in that time, the merits of regulating the unbundling of such a service would be re-evaluated. UPCs are typically deployed for large-scale organisations.
The commissioner recommended not unbundling Telecom's network, which would allow competitors direct access to the network to install their own equipment, at this time.
“The telecommunications commissioner decided [that] while there were some benefits in opening Telecom’s lines to telephone-call competition, the real gains were in improved access and competition for broadband. I understand that Telecom intends to exceed the recommendations for bitstream unbundling set by the commissioner. The extent to which this is achieved will influence any future decision I may make on whether to refer these issues back to the commissioner,” says Swain.
Swain says his decision sends a clear message to Telecom to negotiate commercial agreements and to develop the broadband market.
“I will be watching developments very closely and will be taking particular note at how quickly and successfully Telecom moves to promptly facilitate the delivery of higher-speed, more competitive broadband for New Zealand."