Telecom variation approved

Photo / Alan Gibson Communications and Information Technology Minister Steven Joyce

A fourth variation of Telecom's operational separation undertakings has been approved by the Government, helping to clear the way for New Zealand biggest telephone company to participate in government's ultra fast broadband initiative.

Telecom requested the variation to address the risks of disruption and the high costs of investment in systems that would become redundant with the roll-out of Ultra-Fast Broadband.

The separation undertakings set out the requirements for splitting Telecom into three separate business units and came into effect in March 2008.

The latest variations mean Telecom no longer has to migrate its existing broadband customers onto the new wholesale broadband service; doesn't have to create a new VoIP over copper service by December for its 17,000 existing customers, and no longer has to build a new set of wholesale operational support systems that are not consistent with the industry structure implied by UFB.

Communications and Information Technology Minister Steven Joyce said the changes served the best interests of consumers and allowed Telecom to "develop services and systems that are consistent with changes being brought about by the Ultra-Fast Broadband Initiative."

Telecom said yesterday it was in the process of re-pricing its bid for involvement in the UFB initiative, and hoped to hear within weeks whether it will be chosen as a partner in the $1.8 billion government-sponsored project.

The head of the national telco's Chorus unit, Mark Ratcliffe, said the company had been "sharpening its pencil" since losing out in the first round of preferred partner choices, which were announced last month and went to three regional bids led by electricity network companies in Timaru, Whangarei, and the Waikato.

- NZ HERALD ONLINE / BusinessDesk