Commission issues draft determination for Unbundled Bitstream Access service

The Commerce Commission has issued its draft determination on the price and non-price terms for access to Telecom's Unbundled Bitstream Access (UBA) services and is now seeking submissions from the telecommunications industry.

The UBA service is a wholesale broadband service that allows telecommunications companies to supply a range of broadband services to retail customers.

The Commission's determinations will allow competitors to take the services from Telecom without the need for any separate commercial agreements. The release of the draft determination on UBA services, together with July's draft determination on the unbundled copper local loop service (UCLL), mark a further step toward ensuring a competitive telecommunications sector in New Zealand, Telecommunications Commissioner Dr Ross Patterson said today.

"The UBA service provides companies seeking access with options to obtain wholesale services from Telecom so they can supply a greater range of services to their customers," Dr Patterson said.

"When taken in conjunction with the unbundled copper local loop, access seekers will have more choice as to which service, or combination of regulated services, best fits their business plans. They may choose to invest in infrastructure, by renting the copper local loop and installing their equipment in Telecom's exchanges, or they may choose to buy wholesale bitstream services from Telecom, adding value to them before on-selling," Dr Patterson said.

The Commission has set prices for a Basic Service, and two Enhanced Services, with different settings for quality of service. The enhanced services allow access seekers to provide good quality Voice Over IP and other real-time services over broadband.

Access seekers may now choose to supply UBA-based services without a traditional phone service (Naked DSL). Where Naked DSL is acquired, the access seeker must also meet the costs of Telecom's local loop network. The Commission has adopted the same price for the local loop as in the draft determination for the UCLL service issued in July. This results in geographically de-averaged pricing for the naked UBA services, consistent with the approach in the earlier local loop determination. The pricing for UBA services is as follows:

The closing date for submissions on the draft determination is Wednesday, 26 September 2007. This will be followed by a period for cross-submissions. The Commission will then prepare a final determination. It is anticipated that the final determination will be issued in December.

The Commission's draft determination and related documents can be found on its website.

Background

Unbundled Bitstream Access (UBA) Service is a wholesale broadband service that allows telecommunications companies to supply a range of broadband services to retail customers. The UBA service is provided over the standard copper pairs (telephone line) that run from a Telecom telephone exchange to an end user's home. The service is accessed by using Telecom's equipment, unlike the UCLL service which uses an access seeker's own equipment.

The Unbundled Copper Local Loop (UCLL) service is a wholesale service that allows telecommunications companies to supply a range of broadband services to retail customers using Telecom's standard copper pairs (telephone line) that run from a Telecom telephone exchange to an end-user's home.

The UCLL Co-location service allows other operators to access Telecom's exchanges to install their own equipment so that they can use the UCLL service.

The UCLL and UBA Backhaul services refer to the transmission capacity in Telecom's network necessary to support the UCLL and UBA services.

Standard Terms Determination process under amended Telecommunications Act. In December 2006, the Telecommunications Act was amended to incorporate a process for the Commission to make a standard terms determination on which a designated access or specified service must be supplied by Telecom to all access seekers requesting the service. A standard terms determination is comprehensive enough and contains sufficient detail so that there is no need for an access seeker and Telecom to enter into a separate agreement for provision of the service. A standard terms determination includes non-price terms proposed by Telecom, usually in consultation with access seekers, and price terms for access to the service set by the Commission.

The STD process On 22 February 2007 the Commission initiated standard terms determination (STD) processes for the UCLL and UBA services. Since then the Commission has initiated STD processes for the UCLL co-location service and the UCLL backhaul and UBA backhaul services. Draft STDs for the UCLL and UCLL co-location services were released by the Commission on 31 July 2007 for comment. The closing date for submissions on the draft UBA determination is Wednesday, 26 September 2007. This will be followed by a period for cross-submissions. The Commission will then prepare a final determination. The STDs for the UCLL, UCLL co-location and UBA services are due to be finalised later this year. STDs for the two backhaul services are due to be finalised in 2008.

A brief overview of the key steps in a standard terms determination process is available on the Commission's web site www.comcom.govt.nz under Telecommunications - Standard Terms Determinations

Telecommunications Commissioner. Dr Ross Patterson was appointed Telecommunications Commissioner for a five-year term beginning 12 July 2007. Dr Patterson is a New Zealand lawyer with a PhD in commercial law. For the last ten years he has been working in Sydney, Australia as a partner of Minter Ellison Lawyers, where he was head of the firm's competition and regulatory practice.