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Copper pricing decision puts NZ out of step

TUANZ warns that the final copper pricing decision puts NZ out of step with rest of world

TUANZ warns that the Commerce Commission draft decision on wholesale copper charges this morning will likely lead to higher prices for users which puts New Zealand further out of step with the rest of the world. Recent research by organisations such as the ITU already have New Zealand pricing comparing poorly.

The final price announced today adds a further $3.30 to the previous draft meaning that there’s been a steady increase from the Initial Pricing decision of $34.44 to this final wholesale price of $41.69. Users had seen the benefit of initial lower prices flowing through as a result of the process and improved competition but now will likely face further increases in their monthly charges given this final price applies from tomorrow (16th December 2015).

“These prices will have a direct impact on users, and especially those users who are unable to take up UFB services. These include the 20% of the population who live rurally, and who have no other fixed line options and will continue to rely on copper phone lines for the foreseeable future.” said Craig Young, CEO of TUANZ.

“This decision also lends weight to ensuring that we as a country get the current review of the Telecommunications Act right so that post 2020 we establish an internationally competitive business environment when it comes to the cost of connectivity” Mr Young stated.

TUANZ recognises that the Commerce Commission is an independent arbiter who must apply the law around these pricing processes as it stands, but are disappointed that the end users look to have lost out in this latest decision. “We are though happy that the Commission has decided (in a split decision) to not apply any backdating to the pricing which is a positive outcome for users.” said Mr Young.

Mr Young is concerned that this may not be the end to the more than 2 years of uncertainty as there is the possibility that one of the telecommunications providers may choose to challenge the process in court given the material size of the latest price rise.

“TUANZ has a vision of helping New Zealand move into the top 10 for business usage of digital technology (using the World Economic Forum Network Readiness Index) and while this decision makes this task a little harder, it is one we are still fully committed to”

ENDS

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