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Let’s Look At The Real Facts


Telecom today challenged the small group of companies behind the Call for Change campaign to stop distorting the facts and get on with business.

Telecom today challenged the small group of companies behind the Call for Change campaign to stop distorting the facts and get on with business.

“The reality is that broadband is gathering a head of steam and the new regime is starting to work,” Telecom Public Affairs & Government Relations Manager John Goulter said today.

“We said the other week it’s the year of broadband for New Zealand and we want to lay out why.

“The competitors’ campaign is attempting to influence the Government’s decision on the Commerce Commission’s recommendation in favour of bitstream unbundling as a way of spreading broadband uptake in New Zealand.

“We’re totally fired up about broadband and when you look at all the activity going on across New Zealand, you can see the great progress being made,” Mr Goulter said.

• Broadband is now available to more than 90% of the country through our own network and BCL’s wireless service.

• Coverage will be virtually 100% by June through adding satellite.

• New JetStream plans for customers go live next month, including the lowest prices ever and a flat rate plan so high-use customers will always know exactly how much they are paying.

• More than 40,000 school students are benefiting from SchoolZone, a customised, secure broadband service designed specially for schools. The sign-up rate of new schools last month was the highest since the service was launched.

• PROBE negotiations are on track for Telecom and other suppliers to sign contracts and start delivering broadband to communities throughout New Zealand.

• The key to broadband success is local communities, central and local government and private sector players working together to develop applications that customers need. Telecom sees this as a critical focus and is working with the E-regions initiative to develop broadband applications based on the real needs of communities, such as diabetes among Maori and getting local government services on line.

• Fonterra farmers are adding value to their business though the broadband deal between Fonterra and Telecom.

• Telecom will be talking to ISPs and carriers about the unbundled bitstream service, as part of the ongoing negotiations around wholesaling business and residential services.

• Work is advanced on developing the unbundled partial circuits offer to competitors which Telecom proposed last year.

“Across every part of the company, Telecom is dedicated to broadband and to working with the rest of the industry to keep the momentum going.

“All that activity puts the lie to the claims being made by the current campaign.

“The campaign is based on the false implication that local loop unbundling would result in a reduction in phone line rentals for all households outside of Wellington and Christchurch.

“That’s wrong. The major focus of the review is about providing broadband – and we’re working hard on getting broadband to more homes, businesses and schools. The irony is that TelstraClear has itself said it wouldn’t use local loop unbundling to provide service to households.

“It’s totally wrong for the campaign to say they only want what Telstra provides competitors in Australia. Wholesaling is far more important – a company such as AAPT uses wholesaled services about 10 times more than unbundled services. And TelstraClear could do the same in New Zealand if it chose.

The facts behind the campaign are these:

• The major focus of the review is whether unbundling would deliver broadband to more people. Telecom is totally committed to broadband and has just announced new plans which include lower prices than ever, a flat-rate plan and slashed overage charges when you go over the limit on the other plans

• TelstraClear lobbied for years for a review of unbundling, they got one, which took a year and involved some of the best brains in the world – now they don’t like what it has recommended which is bitstream unbundling which would allow competitors to provide their own broadband services.

• The cost of providing service to customers varies across the country. It ’s cheaper to provide services for customers in the cities than in the hard-to-reach isolated areas.

• If we focused only on the easy-to-reach customers, as our competitors have, it would be easier to offer those customers lower phone line prices.

• We are committed to providing a network for the whole of New Zealand. There is a price differential of about 23 cents a day in line rental for customers in Wellington, Kapiti and Christchurch. This is to ensure we remain competitive in those urban areas where others have chosen to operate.

• New Zealand customers are way better off than Australians. If the average New Zealander had to pay Telstra’s Australian prices for their phone calling they would be paying at least $176 a year more for their line rental and local calls.

• Telstra’s line rentals in Australia have risen by 54% over the last four years. Telecom’s have risen by 9.7% over the same period.

• TelstraClear can use the wholesaling part of the Telecommunications Act to provide service to households if they want to. An application for residential wholesale is already before the Commission.

• This campaign does not represent the industry. There are some 60 ISPs and call providers in the market; TelstraClear has enlisted the support of four of them, two of whom are owned by the same people.


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