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Draft TSO determinations for 08/09 released

Draft TSO determinations for 08/09 released by Commerce Commission

The Commerce Commission has released its 2008/09 draft determinations on the:

- cost of the Telecommunications Relay Service (TRS) for the hearing impaired; and the

- proportion of the cost to be met by each party liable to contribute to the cost of the TRS and Telecom New Zealand’s local residential telephone service obligation.

Each TSO draft determination covers the period 1 July 2008 to 30 June 2009.
The TRS is a Telecommunications Service Obligation (TSO) provided by Sprint International New Zealand Limited. The Commission has determined in the draft that the TRS cost for that period is $2.15 million.

The TSO cost allocation determination identifies which parties will bear the costs and the proportion of the cost they will bear once the Commission finalises its calculation of the TSO costs.

The Commission is also currently preparing a draft cost calculation determination for the 2008/09 TSO on Telecom’s local residential telephone service.

The cost determined in both TSO cost calculation determinations when finalised, will be apportioned in accordance with the TSO cost allocation determination for 2008/09. Telecom New Zealand Limited, Vodafone New Zealand Limited and TelstraClear New Zealand Limited will bear more than 99 per cent of the TSO costs. The remaining costs will be spread between WorldxChange Communications Limited, CallPlus Limited, Compass Communications Limited, Teamtalk Limited, Woosh Wireless Limited, Orcon Internet Limited, Two Degrees Mobile Limited, Airnet NZ Limited and Link Telecom (NZ) Limited, in proportion to their net TSO-qualified revenues.

Interested parties are invited to make submissions on the two draft determinations. The closing date for submissions is 5pm, 24 November 2009.
Copies of the Commission’s draft determinations are available on the Commission’s website under Industry

Regulations/Telecommunications/Telecommunications Service Obligations

Under Part 3 of the Telecommunications Act 2001, Telecommunications Service Obligations (TSO) are entered into in order to facilitate the supply of certain telecommunications services to groups of consumers that may not otherwise be supplied on a commercial basis, or at a price that is considered by the Minister of Communications to be affordable to those consumers.
There are currently two TSO instruments:

- TSO Deed for Local Residential Telephone Service between the Crown and Telecom; and

- TSO Deed for Telecommunications Relay Services (TRS) for the hearing impaired between the Crown and Sprint.

The TSO instruments costs once determined are apportioned among liable persons. Prior to the revision of the Telecommunications Act in December 2006 the cost apportionments were part of the TSO determinations. Now, under the revised act, the apportionments (and therefore each party’s TSO-qualified revenue) are provided for in a separate cost allocation determination.
The Commission administers the TSO deeds by:

- monitoring compliance of the relevant service providers;

- determining the liable persons;

- determining the cost faced by the service providers, unless the amount is specified in the deed; and

- determining the apportionment of this cost amongst the liable persons.

The ‘liable persons’ are Telecom and the companies operating public switched telephone networks (PSTN) that are interconnected with Telecom’s fixed PSTN.


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