Submissions on the government’s Telecommunications Bill are drawing attention to a clause which lets Telecom off having to provide access to the residential local loop at wholesale rates.
The issue arises from a section of Schedule One of the bill, which refers to the services Telecom must offer for wholesaling to its competitors.
“A non price-capped retail service ... offered by Telecom ... by means of its fixed telecommunications network” is how the bill defines what must be wholesaled.
But several competitors have pointed out that means residential callers making local calls aren’t included.
“It endorses Telecom’s monopoly in that area,” says Telstra-Saturn’s regulatory adviser Peter Alsop.
“We think that’s quite a paradox for the whole regime, which is designed to promote competition.”
Alsop doesn’t believe it is an oversight by the government.
“It was a deliberate move on the part of the drafters of the bill. The government’s main concern is scaring off network investment. They want people to go to the boondocks and build networks there. What we’ve said is we’ve done the sums and it’s just not economic to replicate Telecom’s network in all parts of the country.”
Labour MP David Cunliffe, who chairs the parliamentary select committee considering the bill, agrees the local loop wholesaling issue is significant.
“We will be carefully considering it,” says Cunliffe.
He says the bill is the result of a careful and deliberate process begun more than a year ago.
“The bill is the product of extensive consultation between the ministry and industry players. It follows a long process of policy development starting with the Fletcher inquiry.”
Telecommunications Users Association (TUANZ) chief executive Ernie Newman is also concerned about a part of the bill outlining the powers of the new telecommunications commissioner.
“We are concerned about the fact that one specialised commissioner can be overruled by two non-specialist commissioners.”
The select committee considering submissions on the bill travels to Auckland to hear oral submissions on July 19.