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Chorus concerned users switching away to wireless due to fake copper shutdown

New Zealand broadband wholesaler worried people are shifting to fixed wireless due a copper network shutdown that isn't pencilled in yet.
Written by Chris Duckett, Contributor

New Zealand broadband wholesaler Chorus has noted in its first-half results that it is concerned people are shifting away from its fixed-line services to fixed wireless products offered by the country's mobile network providers.

"The number of disconnections from our fixed-line network slowed markedly in the first six months. However, mobile network operators continue promoting their own fixed wireless services as an alternative, and we remain concerned that 'the pending shutdown of copper' is still incorrectly cited to customers as a reason to move," newly minted Chorus CEO JB Rousselot said on Monday, who replaced now NBN board member Kate McKenzie.

"As we've previously said, customers should be clear that we have not announced any timeline for switching off our copper network. If we decide to do so in the future, we'll communicate it well ahead of time and it would be on a street-by-street basis only where fibre is available as an alternative."

Across the six months to December 31, Chorus added 82,000 fibre connections, 1,000 premium fibre connections, while at the same time having 101,000 copper-based services drop off its network. Chorus now has 1.43 million fixed-line connections in New Zealand, compared to 1.49 million a year prior.

The company has 1.1 million Ultra-Fast Broadband (UFB) connections, with 969,000 on fibre, 196,000 in its rural zone, and 124,000 in the local fibre company UFB zone.

The company said it now has 68% of its UFB connections on fibre, with 1Gbps plans now accounting for 13% of its fibre plan uptake. 100Mbps is still by far the most common plan with Chorus, having added around 50,000 new connections on that plan in the half, compared to 29,000 on 1Gbps.

Chorus said it had 58% uptake in its UFB1 footprint and 34% uptake in its UFB2 footprint. The company said it completed UFB1 one month ahead of schedule and within its NZ$1.8 billion guidance, at a cost of NZ$1,558 per premises passed. Chorus expects to claim NZ$924 million in financing from the New Zealand government for 827,000 premises passed.

Overall, the company posted earnings before interest, tax, depreciation, and amortisation (EBITDA) of NZ$332 million compared to NZ$318 million a year prior, from revenue of NZ$483 million, down NZ$6 million on a year ago.

The company now employs 862 people, compared to 914 a year ago.

During the half, the New Zealand Commerce Commission detailed its draft regulation for fibre providers with the changes set to apply from 2022 when it is expected the majority of Kiwis will be connected to the UFB network.

Among the changes detailed was a revenue cap for wholesaler Chorus, which ComCom said would limit the prices consumers would have to pay, as well as minimum standards for service and network performance.

All fibre operators in New Zealand would need to publish metrics such as profits, quality of service, and expenditure.

In November, Chorus launched its 2Gbps and 4Gbps symmetric speed plans.

As of January, average household data usage by fibre users was 372GB per month, up 30GB from the June number.

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