Telecom censure decision on hold

By RICHARD BRADDELL

Telecom should know next month whether the Ministry for Economic Development will prosecute it for missing the September 30 deadline for publishing the costs of its local network.

David King, manager of the ministry's telecommunications policy group, said a report from consultants Ernst & Young on whether Telecom had reasonable grounds for the delay had been presented to Communications Minister Paul Swain.

He had decided that the issue would be addressed in tandem with the unveiling of the Government's telecommunications policy, Mr King said.

Wide-ranging recommendations from the ministerial inquiry into telecommunications were presented to the Government at the end of September, with Mr Swain aiming to present policy before Christmas.

Although the sanction risked by Telecom is hardly crippling - a fine of $200,000, plus $10,000 for every day it fails to comply - the disclosures form part of one of the few meaningful attempts by the previous Government to curb its market power.

The requirement to disclose separate local loop costs was aimed at giving competitors better knowledge of the true costs when negotiating interconnection agreements.

It could also be useful now in determining what changes should be made to the Kiwi Share, which requires Telecom to provide local services equivalent to those when it was privatised.

In spite of producing information detailing $167 million of losses in meeting Kiwi Share obligations to service rural networks, Telecom said at the end of September that it was unable to comply with the deadline to produce data on its entire local network because of the complex and time-consuming work involved.

It hoped to reveal the data early next year.