Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Copper Decision: Chorus Crying Wolf


5 NOVEMBER 2013

Copper Decision: Chorus Crying Wolf

Copper lines monopolist Chorus is crying wolf in its response to this morning’s pricing determination by independent regulator the Commerce Commission, the Coalition for Fair Internet Pricing said today.

“Chorus is a strongly profitable company that cannot possibly be at any risk as a result of this morning’s determination,” a spokesman for the coalition, Paul Brislen, also chief executive of the Telecommunications Users Association of New Zealand (TUANZ), said today.

“The impact on Chorus’s monopoly revenues from today’s decision is estimated to be around $104 million a year,” Mr Brislen said.

“This compares with its revenue of $1.06 billion last year, its $663 million EDITDA, the $681 million it spent on capex, its net profit after tax of $171 million, the $95 million it paid in dividends to its largely foreign shareholders and its $3.3 billion in total assets.

“What’s more, Chorus has known about the Commerce Commission pricing review since 2011 when it put in its pitch to build the new ultra-fast broadband (UFB) network.

“It has also had nearly a year to prepare for today’s announcement after last December’s draft determination.

“It is not credible for a company of this scale and profitability, which pays its chief executive $1.8 million a year to plan for the future, to say a well-signalled change in pricing would create the type of risks it has claimed in its extraordinary press statement this morning.

"The suggestion it could default on its debt as a result of not planning for a long-signalled regulatory change beggars belief coming from a chief executive earning $1.8 million a year.

“It almost appears to be a case of the company talking down its own share price, to put pressure on the government to intervene in the market and over-ride the independent Commerce Commission in order to boost its profits.

“Chorus is crying wolf, and the government should simply tell it to accept this morning’s decision, make whatever minor adjustments are needed to respond to it, and get on with meeting its contact it build UFB for the 30% of New Zealanders who are believed to want it by 2020, and the 75% of New Zealanders who will eventually have access to it.”

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Revenue Renewal: Tax Modernisation Programme Launched

Revenue Minister Todd McClay today released the first two in a series of public consultations designed to modernise and simplify the tax system. More>>

ALSO:

Scoop Business:
NZ Puts Seven New Oil And Gas Areas Put Up For Tender

A total of seven new areas will be opened up to oil and gas exploration under its block offer tendering system, as the New Zealand government seeks to concentrate activity in a few strategically chosen areas. More>>

ALSO:

Half Full: Dairy Payouts Steady, Cash Will Be Tight

Industry body DairyNZ is advising farmers to focus on strong cashflow management as they look ahead to the 2015-16 season following Fonterra's half-year results announcement today. More>>

ALSO:

First Union: Cotton On Plans To Use “Tea Break” Law

“The Prime Minister reassured New Zealanders that ‘post the passing of this law, will you all of a sudden find thousands of workers who are denied having a tea break? The answer is absolutely not’... Cotton On is proposing to remove tea and meal breaks for workers in its safety sensitive distribution centre. How long before other major chains try and follow suit?” More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news