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BDFL - Memuneh
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#272313 19-Jun-2020 09:40
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Just received:

 

 

Chorus has today updated Retail Service Providers (RSPs) on planned changes to the pricing of its wholesale fibre products over the next three months, along with outlining its support to RSPs on the doubtful debts they accrued during lockdown.

 

The reduced pricing and delayed increase are expected to deliver savings of around $10m to RSPs, and the lockdown debt package is a further $2m of value.

 

The key planned product changes are:

 

  • Gigabit wholesale fibre pricing will reduce from $60 a month to $56 a month from 01 July 2020. Gigabit is already Chorus’ fastest growing plan.
  • As previously signalled, the annual regulated CPI increase to fibre products will be delayed until 01 October 2020, at which point the price for 100Mbps fibre will increase from $46 to $47.15. Chorus is consulting with RSPs on this change over the next two weeks.
  • Small business fibre pricing will reduce by $3 a month to $52 from 01 July 2020, acknowledging the pressure SMEs are facing.

The price changes are wholesale only and the decision about passing on either reductions or increases to consumers sits with the RSPs.

 

Chorus CEO JB Rousselot said the changes strike the right balance of passing on savings to RSPs, while still enabling ongoing investment in infrastructure.

 

“We are conscious of the critical role Chorus infrastructure played during the lockdown, and we believe this mix of pricing changes will support RSPs, allow Chorus to continue to invest in the capacity, reach and resilience of the fibre network, and also enable more customers to benefit from higher specification plans.”

 

“For example, the value of gigabit plans was seen during the lockdown, as they are the ideal connection for families who may have multiple people working or learning from home all at the same time. High-quality small business fibre will also have an important role to play in supporting economic recovery.”

 

In addition to the savings, Chorus has also announced that it would create a further fund of $2m to provide relief for RSPs who elected not to cut off customers who were unable to pay during the lockdown.

 

“We support the decision some RSPs made not to cut off customers during the lockdown, which in some cases has seen customers’ debt to them grow, potentially resulting in higher than usual rates of non-payment.

 

“We have said throughout that Chorus will play its part in supporting RSPs that faced the risk of higher bad debt due to the lockdown. The fund represents an estimate of the increased risk of bad debts experienced by the industry, for the period of the lockdown, based on feedback from retailers and other industry analysis,” he said.

 





 

 

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'That VDSL Cat'
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  #2507904 19-Jun-2020 09:58
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It's great news, but i'm also not sure to the average joe this translates well.

 

 

 

I forsee this sort of news being read as, Cool. my fibre provider should drop my gbit plan by $4.





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  #2507912 19-Jun-2020 10:16
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This is such a cut throat market which is why we don't do any residential connections (including staff) and bundle broadband in with other IT services

 

I would like to see the RSPs get more of a margin on the connections, only takes a few people late paying bills for the RSP to be losing money (espically small ones like us)


 
 
 
 


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  #2507913 19-Jun-2020 10:26
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These savings should not be passed onto the consumers as right now it's a race to the bottom for the retailers


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  #2507922 19-Jun-2020 10:45
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If I recall major structural changes are legislated for Chorus at some stage to remove its monopoly. Maybe I am wrong....but they are a monopoly and as NZ completes its changeover and installation to the new network then surely changes will be required. Seems to me that them setting all the pricing for internet in NZ seems wrong now. Whilst they have achieved a lot, they do have some issues.


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  #2507923 19-Jun-2020 10:48
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Mahon:

 

If I recall major structural changes are legislated for Chorus at some stage to remove its monopoly. Maybe I am wrong....but they are a monopoly and as NZ completes its changeover and installation to the new network then surely changes will be required. Seems to me that them setting all the pricing for internet in NZ seems wrong now. Whilst they have achieved a lot, they do have some issues.

 

 

@Mahon A monopoly really? Odd as I have a 1Gb fibre connection and the wholesale provider is not Chorus same with the neighbours and everyone else around me 


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  #2507934 19-Jun-2020 11:00
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Linux:

 

Mahon:

 

If I recall major structural changes are legislated for Chorus at some stage to remove its monopoly. Maybe I am wrong....but they are a monopoly and as NZ completes its changeover and installation to the new network then surely changes will be required. Seems to me that them setting all the pricing for internet in NZ seems wrong now. Whilst they have achieved a lot, they do have some issues.

 

 

@Mahon A monopoly really? Odd as I have a 1Gb fibre connection and the wholesale provider is not Chorus same with the neighbours and everyone else around me 

 

 

How many LFCs can provide the regulated services at your address?

 

 

 

Cheers - N





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  #2507935 19-Jun-2020 11:00
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Linux:

 

These savings should not be passed onto the consumers as right now it's a race to the bottom for the retailers

 

 

I could not agree with you more


 
 
 
 


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  #2507938 19-Jun-2020 11:01
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hio77:

 

I forsee this sort of news being read as, Cool. my fibre provider should drop my gbit plan by $4.

 

 

 

 

And that is exactly how I read it :)

 

At the very least I would not expect to see a price rise this year.

 

 


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  #2507943 19-Jun-2020 11:03
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I mean, Chorus *is* a monopoly in their service areas... but how could they not be? Shall we build a second UFB network? Split Chorus up even further? Even with Chrous split up by region, there's always going to be a local monopoly over fibre in each area. And with mandated baseline products and the freedom to improve beyond that, I don't see any benefit from splitting them up further. If there were any concerns about the wholesale prices, I'm sure the ComCom would look into it.

 

 

 

The ISP/Last mile split mandated in NZ regs means that there is no monopoly in the most important market, the ISP market - and that makes NZ probably the most competitive ISP market in the world.


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  #2507945 19-Jun-2020 11:06
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@Talkiet 1 for Fibre and I paying $90 a month for a unlimited 1Gbp/s down and 500Mbp/s up and a static IP

 

Gotta love NZ internet access :)


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  #2507950 19-Jun-2020 11:16
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Part of the effect of the ultra fast fibre project was to reduce the monopoly. Although chorus did win some areas large parts of the country have ultrafast fibre that is not chorus owned or maintained.

 

 

 

The issue in NZ is it's a small market with a lot of geographical challenges, because of this we are unlikely to ever see much competition for the actual fibre cables outside of major centres. The Ultrafast thing would never have happened without government involvement.

 

 

 

So while chorus do have a bit of a monopoly in places it's not everywhere and it is not the gold mine everyone seems to think it is. They may not be saints or anything, and I'm sure they could charge a bit less for some services, but they probably have the least profitable part of the business with most of the risks and costs involved with building and maintaining the network. They also are heavily regulated in what they are allowed to charge.

 

 

 

ISPs tend to point the finger at chorus as the source of all problems and the reason for high prices, while happily adding their markup and making a good profit off it. 


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  #2507978 19-Jun-2020 11:46
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Dugimodo:

 

ISPs tend to point the finger at chorus as the source of all problems and the reason for high prices, while happily adding their markup and making a good profit off it

 

 

LOL. 

 

https://xkcd.com/285/

 

Cheers - N

 

 





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Please note all comments are the product of my own brain and don't necessarily represent the position or opinions of my employer, previous employers, colleagues, friends or pets.


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  #2507979 19-Jun-2020 11:48
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Talkiet: How many LFCs can provide the regulated services at your address?

 

Sounds like you are advocating for unbundled DFAS/GPON to allow competition as Chorus are charging too much. 🤣

 

- Lobs the grenade and then exists stage right in this conversation. 😀 





and


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  #2508039 19-Jun-2020 12:27
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BarTender:

 

Sounds like you are advocating for unbundled DFAS/GPON to allow competition as Chorus are charging too much. 🤣

 

 

Wait till they get a DFAS quote.... we don't have any Chorus DFAS but lots of Vital Dark Fibre and it isn't cheap!


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  #2508045 19-Jun-2020 12:50
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Linux:

These savings should not be passed onto the consumers as right now it's a race to the bottom for the retailers



It is a race to the bottom which is excellent for consumers. If RSPs can't differentiate themselves in any meaningful way then they rely on price. Consumers don't care about the RSPs business, it's not their job to.

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