The Commerce Commission has released a report for consultation indicating its intention to recommend to the Minister for Communications that Spark’s resale voice services be deregulated.

Spark’s resale voice services enable other retail service providers (RSPs) to rebrand and on-sell fixed‑line phone services based on Spark switches, avoiding the need to deploy their own infrastructure. These services are provided on a commercial basis. The inclusion of these services in the Telecommunications Act gives the Commission the ability to specify terms for the services but this has not been required to date.

Telecommunications Commissioner Dr Stephen Gale said providers including Chorus, local fibre companies and fixed wireless operators offer wholesale voice services that compete with Spark’s resale service.

“Broadband networks now cover 97% of commercial and residential landlines and provide competitive alternatives for delivering voice services. The remaining 3% are mainly remote voice-only customers where Spark is the sole fixed line wholesale provider. However, for the majority of these remote lines, RSPs can use fixed wireless services from either the Rural Broadband Initiative or based on extended mobile networks. A small number of outstanding consumers that can access voice only lines are protected by a separate regulated price cap. Given this, our view is we should remove the resale services from the Act,” Dr Gale said.

The draft report can be found on the Commission’s website. Submissions close on Monday 17 October and cross-submissions on Wednesday 26 October. A public conference to discuss the Commission’s view and submissions will be held on 1 November.

The Commission expects to provide its final recommendation to the Communications Minister in January 2017.Background

Schedule 1 of the Act contains the regulated wholesale services. The three wholesale services that are the subject of this review are used by RSPs to supply the most common retail telecommunications services to end-users. As markets evolve, new retail services are developed and wholesale service providers can face increased competition, to an extent that it may no longer be necessary to mandate access to a service through Schedule 1. On 30 June 2016 we announced we would investigate removing three resale services from Schedule 1 of the Act:

• local access and calling service offered by means of fixed telecommunications network
• retail services offered by means of a fixed telecommunications network
• retail services offered by means of a fixed telecommunications network as part of a bundle of retail services.