Telecom NZ wants wholesale scrutiny

The comments from the telco's CEO Theresa Gattung came after Telecom yesterday said it would voluntarily separate its wholesale and retail operations.

The move is seen as an attempt to stave off further intervention in New Zealand's telecommunications industry from a government that early in May outlined a sweeping package of reforms in the sector, designed to promote competition and boost broadband uptake.

"When this model is set up, all players will be dealing with an independent wholesale unit which will operate according to a number of firm working principles," Gattung told a telecommunications conference in Auckland this morning.

She noted those principles would include transparent external reporting, customer equivalence in service delivery processes and service levels, and oversight by an independent group including industry and other stakeholder representatives.

"That independent oversight group will be critical to the success of this approach," Gattung said.

"It will represent the industry and the interests of end-customers, so it's critical that it has real autonomy and clout. Who's on that group will be determined in consultation with the industry."

The Telecom CEO said in a wider sense, the way forward for her company required "much more cooperation with the industry".

She noted Telecom had contacted its wholesale customers with a proposal to establish two user groups to work on technical details relating to new wholesale services.

"The idea behind these user groups is to get them to work on the 'behind the scenes' stuff that customers never see, but which needs to be in place to enable the delivery of new services in the new environment as quickly as possible," Gattung said.

She noted Telecom did not intend to lead or control the groups.

"That will be in the hands of an independent facilitator, one that all parties are happy with -- including potential access seekers, end user representatives, the Commerce Commission and the Ministry of Economic Development," Gattung said.

But as Telecom builds closer ties with its rivals, Gattung admitted it wouldn't be all plain sailing.

"We don't expect you to agree with everything we suggest," she said, noting there would be an ongoing role for New Zealand's competition regulator.

"When we can't agree, we'll commit to the referee's decisions," she said. "All we hope is that people will be engaged."

"I think the new environment does call on us all to engage, and make the most of the role we have in advancing telecommunications services."

Gattung said the next few months would be a "transitional" period for the industry as it adjusted to the government's reform package.

She pointed to the Commerce Commission's determination last week that rivals CallPlus and iHug could get access to Telecom's wholesale Bitstream service under certain regulated terms as a pointer to the nature of this period.

"We will not fight it. It lays down a path that is very much on the roadmap we were already working on," she said. "We will get on with implementing it. We will make the terms available to other players."