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New Zealand government tells Telecom to rejig separation plan

New Zealand government tells Telecom to rejig separation plan

The New Zealand government rejected Telecom Corp.'s plan to break up its operations, saying Friday the nation's largest telecommunications company must change the proposal if it is to meet regulatory requirements.
Telecom immediately said it accepted the government's decision and would change the plan.
The company is a former state-owned monopoly that is New Zealand's biggest fixed-line telephone company by revenue and subscribers. It accounts for around 80 percent of the country's NZ$8 billion (US$6.5 billion; euro4.3billion) telecommunications market.
The government has ordered Telecom to split up its operations to meet fair competition requirements. The changes include stripping Telecom of its fixed-line monopoly, opening its copper wire network to rivals and splitting the company into wholesale, retail and network units.
Communications Minister David Cunliffe said interested parties had raised significant issues with Telecom's separation plans and changes would have to be made to ensure the separation would be effective. He did not name the interested parties.
"The feedback from submitters has been instrumental in identifying the need for greater clarity to ensure that Telecom's operational separation will be effective and enduring," Cunliffe said in a statement.
"I have issued Telecom with a Notice of Requirements of further changes needed to their undertakings to finalize the operational separation process," he said.
Telecom has until March 25 to revise its plan.
Telecom spokesman Mark Watts said the company will be working toward meeting the regulatory requirements.
"I think the minister had to reject it on what other industry players have said. He's saying we've got to get it right, and we agree," he said.
Keith Davidson, executive director of The Internet Society of New Zealand, said as one of the submitters his organization supported the government's decision.
"These final changes to the Separation Plan should ... deliver a more competitive telecommunications market," he said in a statement.
Under the plan, rival companies will gain access to Telecom's networks and exchanges, enabling them to install their own equipment and offer products and services comparable to those of their biggest competitor.


Updated : 2021-05-16 15:28 GMT+08:00