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The Commerce Commission today commenced a review of the links that provide access seekers using the unbundled copper local loop (UCLL) service with a backhaul link between the telephone exchange housing their equipment and their interconnect point.
Commerce Commission Chair Paula Rebstock said, “The Commission indicated when it released the UCLL Backhaul Determination in June last year that it would regularly review these links. This is the first time that the Commission has built an automatic review of the level of competition in a market into its decision.”
The Commission will undertake a competition assessment which will determine whether access seekers have access to the regulated UCLL Backhaul Service on specific primary and secondary links.
If the Commission finds that Telecom does not face limited, or is unlikely to face lessened, competition in relation to specific primary and secondary links of the UCLL Backhaul Service, then it may not be obliged to supply the regulated backhaul service to users. “In these circumstances, competitive pressure should result in supply of such backhaul services to access seekers on reasonable commercial terms,” said Ms Rebstock.
To inform the review the Commission is today seeking information from providers and purchasers of commercial backhaul services, and Chorus. The Commission will consider the information received before releasing a draft review report under section 30R. The Commission is expecting to release this report by Monday 2 March 2009.
“Interested parties will then have an opportunity to make submissions on the Commission’s review of the competition assessment for the UCLL Backhaul STD, before it is finalised in April,” said Ms Rebstock.
Unbundled copper local loop network.
The ‘unbundled copper local loop network service’ (UCLL) refers to the service that enables access to, and interconnection with, Telecom’s copper local loop network. It allows telecommunications companies to supply voice and broadband services to retail customers without the need to replicate the local loop.
Chorus is the Telecom business unit that operates the physical network that telecommunications providers use to deliver phone and Internet services.
The ‘unbundled copper local loop network backhaul (telephone exchange to interconnect point) service’ (UCLL Backhaul) provides transmission capacity in Telecom’s network between the handover point in Telecom’s local telephone exchange and the access seeker’s nearest available point of interconnection (ASNAPOI), for the purpose of providing access to, and interconnection with, Telecom’s UCLL.
The Commission’s UCLL Backhaul STD and related documents, including executive summary, can be found on its web site www.comcom.govt.nz at:
The following terms, which are relevant to this section 30R review and are defined in the UCLL Backhaul STD, are replicated below for ease of reference:
• A Primary Link refers to that part of the UCLL Backhaul Service between Telecom’s local exchange in which the Access Seeker has co-located its equipment, and the Parent POI Site.
• A POI Site is a point in Telecom’s network at which the Access Seeker may interconnect for the purposes of the UCLL Backhaul Service.
• A Parent POI Site means, in relation to a Local Exchange, the POI Site to which that Local Exchange is connected for the purposes of routing the UCLL Backhaul Service.
• A Secondary Link refers to that part of the UCLL Backhaul Service between the Parent POI Site and the ASNAPOI Handover Point.
• The ASNAPOI Handover Point means the Access Seeker’s side of the OFDF in the ASNAPOI.
• Access seeker means an access seeker under the Telecommunications Act that has made a request in writing under section 30S(1) of the Act which Telecom receives from an Access Seeker to make the UCLL Backhaul Service available on the UCLL Backhaul Terms.
Further explanation about Primary Links and Secondary Links is found in Schedule 1 to the UCLL Backhaul Terms.
Section 30R Review process under the Telecommunications Act 2001 (Act)
Section 30R provides that the Commission may, on its own initiative, commence a review, at any time, of all or any of the terms specified in a standard terms determination.
Guidelines to the process for reviewing STDs can be found on the Commission’s website www.comcom.govt.nz at:
Scope of and timeline for the section 30R review
In the UCLL Backhaul STD, the Commission applied the following conditions to the wholesale markets for transmission capacity on each Primary Link of the UCLL Backhaul Service and the wholesale markets for transmission capacity on each Secondary Link of the UCLL Backhaul Service:
(i) Telecom faces limited, or is likely to face lessened, competition in a market for transmission capacity between Telecom's local telephone exchange (or equivalent facility) and the access seeker's nearest available point of interconnection; or
(ii) Telecom does not face limited, or is not likely to face lessened, competition in a market for transmission capacity between Telecom's local telephone exchange (or equivalent facility) and the access seeker's nearest available point of interconnection, and the Commission has decided to require Telecom's unbundled copper local loop network backhaul (telephone exchange to interconnect point) to be wholesaled in that market.
The Commission concluded that:
• Telecom faces limited competition in the provision of transmission capacity on Primary Links of the UCLL Backhaul Service except on the Primary Links listed in Table 2 of the UCLL Backhaul STD; and
• Telecom faces limited competition on the Secondary Links summarised in Table 3 of the UCLL Backhaul STD.
The detail of the Primary Links and Secondary Links where the UCLL Backhaul Service is available was outlined in Schedule 5 - “UCLL Backhaul POI Site Related Information” to the UCLL Backhaul Terms.
The section 30R review will review the application of condition (b) (as set out above) to the:
• Primary and Secondary Links assessed in the UCLL Backhaul STD; and
• New Primary Links from the local exchanges that will be assessed for the first time as part of this review under section 30R. The new Primary Links to be assessed include all Primary Links associated with all unbundled or forecast to be unbundled exchanges, as well as a random sample of other Primary Links. However, the Commission will not reveal the status of these exchanges (ie unbundled, forecast to be unbundled or randomly selected) during any part of the review, due to the confidential and commercially sensitive nature of information about future forecasted UCLL deployment.
The Commission will, however, release a draft review report under section 30R outlining its draft views (including the amendments to any schedules to the UCLL Backhaul Terms) for the purpose of this review by Monday 2 March 2009. Submissions are likely to be due on draft report by Monday 16 March 2009. A separate media release and gazette notice will be released confirming this deadline when the Commission’s draft review report is released.
The Commission expects to release the final section 30R review report and give public notice of result of section 30R review by Thursday 9 April 2009.