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Investment in fibre services

From 2022 the regulatory landscape for telecommunications in New Zealand will change. We are preparing two future-focussed engagement processes in coming months to gather your input. 

Context

From 2022, most of Chorus’ fibre products in most parts of the country will come under new arrangements that set a maximum allowable revenue (MAR) based on Commerce Commission assessment of our costs. The MAR will work alongside a regulated price cap which applies to three of our products (the ‘anchor products’).

This new regulatory arrangement involves the Commission evaluating expenditure proposals from Chorus every three to five years to determine appropriate levels of investment (capex) and operating costs (opex).  Over time, this process will have a significant impact on our investment direction (and hence the quality of the services we provide) and our revenues (and hence the prices we set for fibre products).

We will submit our first regulatory expenditure proposal to the Commerce Commission in October 2020 for regulated fibre fixed line access services (FFLAS) for the three years from 1 July 2022 (regulatory period one, RP1).  The proposal will include:

  • forecast capex and opex levels; and
  • information about our services, our business and our plans.

We see stakeholder engagement as an important part of developing our proposal and will continue to use the current product consultation process in parallel with an investment planning consultation.

What’s happening

Early March we sent a stakeholder update where we informed you that we would issue a consultation paper, hold workshops and invite your views as we prepare our first proposal under new regulatory arrangements.

As well as inviting views on investment focus areas the consultation paper introduces the new regulatory arrangements and how they work; and provides an overview of our planning for RP1. We’ve deliberately kept this paper succinct, recognising other demands on your time. 

Consultation paper

We published on 24 March 2020 our consultation paper seeking stakeholder views on key investment focus areas for our first regulatory period (RP1) under the new building blocks regulatory model being developed by the Commerce Commission. 

You can find the paper here.

NB: Due to COVID-19 developments and the ongoing impact to our industry and all of NZ, we are reviewing how we might best consult on this matter and will be in touch soon with further details. However, in the meantime we are publishing our consultation paper to allow as much time as possible for you to review.

Workshops

We’re also planning workshops during the consultation period to provide an opportunity for questions and to dive deeper in specific areas.

We plan to hold two online workshops: one to provide an overview of the consultation paper, and one for a deeper dive on the contents and any questions you might have.

Due to COVID-19 developments, we are reviewing how and when we might be able to hold these workshops, acknowledging the challenges presented to our industry by this unprecedented situation. We will be in touch with further detail on this soon.

Your feedback will help us firm up plans for RP1 in the middle of this year, ready for our proposal to the Commerce Commission in October.

Next steps & contact

You can register for the workshops by emailing RP1@chorus.co.nz.

We will also make recordings of the workshops available if you’re unable to attend at the scheduled times. If you have any questions or suggestions for the workshops, please contact us using this email address or via your Chorus Account Manager.

 

We have a created a dedicated page on the service provider website in which you’ll find all the information and documentation related to this initiative. Add it to your bookmark so you can access it easily.