The telecommunications sector unexpectedly faces regulatory changes, as Communications Minister Paul Goldsmith seeks to amend current legislation through an omnibus bill with decisions made by the Cabinet Business Committee.
Goldsmith says the changes are to boost rural connectivity, and economic growth.
“World-class connectivity services are vital to Kiwis’ everyday lives. This Government is ensuring we have the right regulatory settings in place for this important market, to support competition, foster innovation and help stimulate economic growth," Goldsmith said.
“Better connectivity, especially for rural areas means improved reliability for everyone- businesses, people accessing digital healthcare, and remote learning for kids. More services also improves competition driving down the monthly cost of telecommunications for households and businesses," the Minister added.
The New Zealand Telecommunications Forum (TCF) industry group sees what Goldsmith proposes quite differently however, and isn't happy with the proposed changes.
"I’m shocked that a National-party led government would consider increasing costs and red tape for the sector and I hope sanity prevails before any decisions are made on the future of the telecommunications regime," TCF chief executive Paul Brislen said.
In particular, the telcos are worried about the Telecommunications Development Levy (TDL) which funds broadband in rural areas, and improvements to the 111 emergency calling service. The TDL stands at $10 million a year currently. It is unpopular with telcos which believe the TDL is a complex funding mechanism that doesn't deliver the intended benefits for users.
Now, the Government wants to create a new regulation-making power, to enable the TDL amounts telcos pay through an Order in Council. Although the proposals suggest the current TDL amount is maintained, the telcos worry that it could increase in the future.
"The TCF is concerned by some of the issues and the way the cabinet paper discusses them. The thorny issue of the TDL is clearly an area of concern - it is mentioned in the cabinet paper but left out of the Minister’s press release," Brislen said.
"Raising the TDL without addressing the complexity of how it is calculated means the industry will be saddled with a massive increase in cost, more overheads as we try to calculate how much each company must pay and potentially have an impact on the price customers pay for services. All this to deliver unspecified projects that may or may not be related to the telecommunications sector," Brislen added.
Starlink and other offshore providers to be captured by regulation
The current regulations did not envisage offshore network operators offering services directly to consumers in New Zealand. This is a reference to SpaceX Starlink, and the Government now wants such operators to be captured by local regulation, so that they're treated the same as local telcos.
This includes being subject to the Telecommunications (Interception Capability and Security) Act 2013 (TICSA); telcos in New Zealand have to offer lawful interception capability to security agencies, and also to notify the Government Communications Security Bureau (GCSB) of proposed network changes. As it stands, the law does not have extra-territorial reach, meaning companies like SpaceX are not subject to it.
Offshore providers should also pay their share, depending on turnover, of the TDL.
If an offshore provider refuses to comply with the proposed new regulation, the Government wants enforcement powers that would let it prohibit or restrict the operator's ability to hold or use radio frequency spectrum in New Zealand.
This would happen if other enforcement avenues fail, or are impractical. The Government could then revoke or limit a provider's spectrum licenses.
Goldsmith also wants membership in the mandatory telco dispute resolution (TDR) scheme to be extended to offshore providers with more than $10 million turnover a year.
Rights for fibre providers to access shared property for installations should be made permanent as well, the Government proposes. The rights to do so expired in January this year.
Finally, the Government wants to amend the constitutions of fibre broadband network builders Northpower Fibre, Enable Networks and Tuatara First Fibre, to align it with that of Chorus.
2 Comments
I'll concede that wireless communication servicing has improved in my rural coastal area BUT there are still significant areas of zero cellphone coverage. AND the dismantling of copper network is underway, leaving subscribers with starlink as the only option.
A beef with the improvements is that data capacity seems to be limited. During holiday periods with the influx of holiday makers there is significant reduction in performance from an end user perspective.
When planning and installing connectivity network extensions to improve coverage in rural areas, telcos need to spec the systems to cater for the increased traffic during holiday periods so that permanent residents do not suffer degraded service.
In most urban areas, fibre is available and residents have choice. In many rural areas residents do not have choice and are at the mercy of what telcos choose to make available and make residents pay significantly more compared to urban subscribers.
Couldn't agree more.
We use a cell-tower to connect to the net, gets slower in holiday times and at 8am-9am.
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