Telecom moves closer to making operational split

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Telecom is a step closer to splitting its operations as it makes progress in its bid for a stake in the Government's ultra-fast broadband scheme.

Crown Fibre Holdings announced yesterday that Telecom was first-in-line to negotiate a partnership with the Government in its $1.5 billion-dollar plan to extend New Zealand's fibre network.

Telecom is bidding to provide the fibre network in 25 regions around the country, including the lucrative Auckland network.

Although a decision will not be reached until March next year, if it goes ahead, Telecom has indicated it will make its network branch, Chorus, a separate business. Chorus will be responsible for infrastructure and laying fibre in the ground as part of the broadband scheme.

Telecom will continue as a retail business, providing phone and internet services. If it goes ahead, it will be the first time a company like Telecom has broken itself up.

"The interesting thing about the separation for Telecom is that it is unprecedented anywhere else in the world," said IDC's telecommunication analyst Rosalie Nelson.