Telecommunications Act: Commerce Commission sets final TSO cost for the 2002/2003 period
Published23 Mar 2005
The Commerce Commission has today announced its calculation of Telecom New Zealand's net cost of complying with its telecommunication service obligations (TSO) for the period from 1 July 2002 to 30 June 2003. The Commission's net cost calculation is $56.78 million.
This figure is $8.89 million lower than the $65.67 million annualised cost of the TSO for the previous period, 2001/2002, and is $5.86 million less than the cost announced in the Commission's draft determination in June 2004.
Several factors have affected the cost. An additional operating cost factor pushed the cost up but this was more than counteracted by the addition of a second tier to the wireless cap, that applies a cheaper wireless technology to cost some areas, and a decrease in the weighted average cost of capital.
The Commission found that 65,679 residential customers were commercially non-viable; 3010 fewer than for the previous TSO period
The net cost of the TSO is shared between Telecom and other network operators providing retail services during the period covered by the calculation.
Those operators are TelstraClear Limited, WorldxChange Communications Limited, Vodafone New Zealand Limited, CallPlus Limited, Compass Communications Limited, Teamtalk Limited, The Internet Group Limited (ihug) and Equant New Zealand Limited.
The apportionment of the cost between Telecom and the other network operators is based on proportionate shares of telecommunications revenues as shown in the following table:
REPORTED CARRIER LIABLE REVENUES
For period 1 July 2002 - 30 June 2003
Liable Revenue
% of total
Implied TSO Charge
($)
($)
Telecom
2,360,201,000
72.84%
41,353,354
Vodafone
688,019,000
21.23%
12,054,860
TelstraClear
172,754,000
5.33%
3,026,843
WorldxChange
6,536,980
0.20%
114,535
CallPlus
4,398,502
0.14%
77,067
Compass
4,767,915
0.15%
83,539
Ihug
2,848,582
0.09%
49,910
Teamtalk
896,984
0.03%
15,716
Equant
0
0.00%
0
Total
3,240,422,963
100.00%
56,775,825
A public copy of the Commission's final determination is available on
