ComCom's copper price cut: Chorus gets its day in court

Chorus CEO Mark Ratcliffe
Chorus 12-month price history (NZX.com)

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Chorus' [NZX: CNUappeal against the Commerce Commission's decision to cut its wholesale copper line pricing begins in the High Court at Wellington today.

The regulator has determined that Chorus unbundled bitstream access (UBA) pricing should be reduced by 23% from December 1.

Chorus' appeal against the decision is set to be heard March 17 to March 19.

But going by previous telecommunications industry regulatory cases, commentators expect the three-day hearing to be merely the first step in a process that will take months or even years, including appeals and counter-appeals. 

Both parties declined comment ahead of today's hearing.

Look for Chorus to try and get the ComCom's price cut determination suspended until a final verdict is reached.

Read more about the issues involved in the case in NBR's preview here

The case is happening in parallel to two other processes, ongoing negotiations with Crown Fibre Holdings over ways for Chorus to cut costs, and a Final Pricing Principals (FPP) review requested by Chorus and now being carried out by the Commerce Commission in regard to UBA and UCLL (unbundled copper local loop) decisions, and the methodology behind them. The regulator says the FPP review could take up to two years; Chorus has asked for a fast-track that would see the review wrapped up by December.

Matters are further complicated by a High Court appeal against ICT Minister Amy Adams ongoing review of the Telecommunications Act (2011), filed late last year by CallPlus.

The review includes options for the govenment to directly set wholesale copper pricing. Earlier, CallPlus CEO Mark Callander told NBR his company was pushing ahead with its lawsuit, despite a political knockback that saw National's coalition partners ACT, United Future and the Maori Party refuse to support any legislatiive change that would over-rule the Commerce Commission's decision on Chorus - effectively blocking the law change route. [UPDATE: CallPlus has dropped its suit]


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