Chorus network capacity to continue to grow to meet need

14 March 2017
Release No. 90

Chorus network capacity to continue to grow to meet customer need

The Commerce Commission has today released the final decision in its review of the non price features of the Unbundled Bitstream Access (UBA) service.

UBA enables retail telecommunications companies to provide internet services over Chorus’ copper network without installing their own equipment in exchanges.

The Commission reset UBA prices in 2015. It has now reviewed the service that Chorus must provide to retail companies. The aim is to ensure that UBA service can continue to be used by retailers to provide the best possible range of competitive broadband services over copper.

The main change has been to add a standard that ultimately requires Chorus to keep its UBA service free of congestion as traffic usage grows.

Telecommunications Commissioner Dr Stephen Gale said there had been general agreement amongst parties throughout the review that the UBA service should keep pace with consumer demand.

“While migration to the new fibre network is progressing apace, UBA will remain a key input for retail broadband for some time yet, particularly in areas beyond the reach of the ultrafast broadband initiative. We are confident that the new standard will not lead to inefficient investment, even if copper is deregulated in UFB areas as currently proposed by MBIE,” Dr Gale said.

The Commission has exempted around 19,000 lines in Chorus’ remote legacy networks from the new service standards until it is clear how much the service to these consumers will be upgraded through the second phase of the Government’s Rural Broadband Initiative.

A copy of the final decision can be found on the Commission’s website.

Background
Under the current UBA STD, Chorus must offer the regulated UBA service at the regulated price but is able (subject to notifying the Commission) to offer commercial variants of UBA services at different prices.

On 14 May 2014, Chorus announced that it intended to introduce new commercial UBA services (Boost variants). As part of the introduction of the Boost variants, Chorus also proposed two changes to the regulated UBA service:

• capping aggregate throughput at the handover point; and
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• withdrawing VDSL as a regulated UBA service.
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After receiving a complaint from Telecom (now Spark) – that Chorus’ proposed changes to the regulated UBA service breached the UBA STD – we commenced an investigation under section 156O of the Telecommunications Act on 22 July 2014.

The investigation was suspended after Chorus put the proposed changes to the regulated UBA service on hold, including in particular, any constraints on the regulated service and the withdrawal of the VDSL service.

As a result of the issues identified during the investigation, we published a consultation paper seeking views from the interested parties on whether we should undertake a review of the UBA STD under section 30R of the Telecommunications Act. The majority of the submissions received supported a formal review. Our consultation process included a workshop with industry participants, publication of draft decision, and submissions and cross-submissions to our draft decision. Our review has now been concluded.

For further information see the UBA page.

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