Rivals in for slice of Kiwi share

By RICHARD PAMATATAU

A chunk of Telecom's customer base may be up for grabs under a review of the "Kiwi share" by Communications Ministry officials.

The prospect has whetted the appetite of rival telcos, who are required to pay a portion of Telecom's costs to service "non-viable customers".

The Kiwi share is, more correctly, the Telecommunications Service Obligation or TSO. This requires Telecom to provide telecommunications coverage throughout New Zealand, including in areas where the costs exceed income from customers. The cost to Telecom of the TSO, calculated by the Commerce Commission at $65.7 million a year, has often been disputed.

Communications Minister Paul Swain has instructed officials to investigate a regional tendering process for the TSO, a process that would allow Telecom's competitors to bid for rights to service groups of customers.

A spokesman for Swain said yesterday that a report was due in the next month or so.

Woosh Wireless chief executive Bob Smith said a review was much needed. "I think it is great ... We are very keen to look at where these areas are and who the customers are and then to discover what needs to be done to look after them."

Vodafone public policy manager Roger Ellis said it was a step in the right direction and, when implemented, would be good news for regional New Zealand.

Ernie Newman, Telecommunications Users Association chief executive, said TUANZ had called for contestability of the TSO provisions for several years.