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

 

Scoop Business: RBNZ Starts Talks On Tougher Rules For Property Speculators

The Reserve Bank of New Zealand is stepping up preparations to restrict lending to residential property investors as it watches house prices, particularly in Auckland, continue to rise strongly. More>>

ALSO:

Research: ‘Ageing Well’ Science Challenge Launched

Science and Innovation Minister Steven Joyce today launched the Ageing Well National Science Challenge, confirming initial funding of $14.6 million. More>>

ALSO:

Scoop Business: Govt Resisting Pressure To Pump More Cash Into Solid Energy

Prime Minister John Key says it is “not the government’s preferred option” to make a fresh capital injection into the troubled state-owned coal miner, Solid Energy, but dodged journalists’ questions at his weekly press conference on whether that might prove necessary... More>>

ALSO:

Lagest Ever Privacy Breach Award: NZCU Baywide Accepts “Severe” Censure In Cake Case

NZCU Baywide says that once it was found to have committed a breach of a former staff member’s privacy, it had attempted to resolve the matter... the censure and remedies for its actions taken almost three years ago are “severe” but accepted, and will hopefully draw a line under the matter. More>>

ALSO:

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news