No competitive backhaul for Telecom NZ's wholesale DSL services

Stuart Corner
Wednesday, 23 March 2011 11:59

IT Policy - Regulation

New Zealand's Commerce Commission has found that there are no competitive backhaul services available to service provider customers of Telecom NZ's wholesale DSL service, the Unbundled Bitstream Access (UBA) service, and it will therefore continue to regulate prices and terms for provision of these services.

The decision is a result of a review by the Commission into whether Telecom faces competition for providing these services.

UBA backhaul allows service providers to connect their networks to a nominated handover point in Telecom's network for a specific area, from which the traffic is carried over Telecom NZ's network to the end user via Telecom NZ DSLAMs in local exchanges.

Telecommunications Commissioner Dr Ross Patterson said: "Competitive UBA backhaul markets have not developed because of the small number of enhanced UBA services that are being purchased from Telecom. In addition, unlike the unbundled copper local loop (UCLL) backhaul, there is no appropriate commercial service that would allow alternative backhaul providers to aggregate backhaul traffic inside the exchange."

In June 2008, the Commission released the UCLL and UBA backhaul Standard Terms Determination (STD), which set out which backhaul routes were subject to regulation, as well as the terms and conditions governing the supply of the backhaul service on those routes. This is the first review conducted by the Commission since the UBA backhaul service STD was issued.

As there are similarities between the UCLL and UBA backhaul services, the Commission says that a combined review process will be undertaken for both in the future. The review of all backhaul links will be conducted annually taking into account competition developments.

The Commission recently identified that more UCLL backhaul links have become competitive - an additional 88 links in its most recent review.