Support for Telecom on regulatory front

Business New Zealand has joined the voices supporting Telecom in its fight against regulation with its own broadband benchmarking survey.

Phil O'Reilly, chief executive of the big-business lobby group, said the survey had showed Telecom's recently announced broadband packages were among the best priced in the world.
"Last year, Telecom's broadband prices for small business packages were outside the 20 best in the world but now they're among the top 10. Residential deals are also among the best in the world."

Business NZ commissioned the survey, which compared prices offered across OECD countries, from Azimuth Consulting. The company prepared a similar survey for the Ministry of Economic Development, released in December, which found that residential prices were sixth best in the OECD, but business broadband was second-most expensive.

The Business NZ survey compared services Telecom will offer from April to those already on the market in other countries. Telecom's prices ranked sixth, fifth and seventh out of 30, respectively, although the company's residential offering did not meet Azimuth's minimum upload speed criteria.

The report noted it was difficult to compare services across countries as there were many differential factors, including speeds and data usage. Azimuth could not be reached for comment.

O'Reilly said the study used "exactly the same methodology" as the Government. But Government statistics, which are periodically compiled by the Ministry of Economic Development, compare existing services with existing services, rather than with pending offers.

The survey comes a week after Telecom called for an independent benchmarking of the company's new prices. Telecom is a member of Business NZ. O'Reilly said the group's policy decisions were not based on membership.

"Telecom is a member of Business NZ, but so are a whole bunch of other telcos," he said. However, the nation's two other big telcos - TelstraClear and CallPlus - are not members.

The Telecommunications Users Association (TUANZ), which counts TelstraClear and CallPlus but not Telecom as members, disputes the findings. Chief executive Ernie Newman said he had faith in OECD and MED statistics, which showed New Zealand's broadband offerings were poor.

"We are not particularly impressed with conflicting figures that come from what seems to be a much less reputable source," he said.

Better prices?

* Telecom's new entry-level broadband service will offer 256 kilobits a second download speed with a 200 megabyte data limit for US$24.16 ($36.50).

* BT's service offers 2 megabit download speed and 2 gigabytes for US$24.32 ($36.80).

* The 200 megabyte limit is by far the smallest data cap of the 30 OECD countries (300 megabytes is the next lowest). At an extra charge of 2c a megabyte, a gigabyte under Telecom's plan would add US$10 ($15) to its price - pushing its plan from sixth place to 22nd.