___________________________________________________________________________
2010/TEL42/PLEN/013
Agenda Item: 5
New Zealand Policy and Regulatory Update
Purpose: Information
Submitted by: New Zealand
42nd Telecommunications and Information
Working Group Meeting - Plenary Session
Bandar Seri Begawan, Brunei Darussalam
5-7 August 2010
APEC Telecommunications and Information Working Group, 42nd Meeting, August 2010
NEW ZEALAND POLICY AND REGULATORY UPDATE
This report covers significant activities and issues from March 2010 to August 2010.
TELECOMMUNICATIONS
The Availability of Regulated Services
Since January 2010, the New Zealand Commerce Commission (“the Commission”) has:
 released a final report on its investigation into mobile termination access services.
 continued preparing a draft report on its investigation into the resale of the fixed incumbent
operator’s retail services.
Mobile Termination Investigation
In June 2010, the Commerce Commission released its final report on its investigation into whether
mobile termination access services (MTAS) should be regulated. The investigation concerns mobileto-mobile voice termination, fixed-to-mobile voice termination and short-message-service termination.
In its report, the Commission recommended that the Minister regulate MTAS.
The Minister is currently considering the Commission’s recommendation. If he accepts it, then the
Commission will begin a process designed to set the terms on which access seekers can demand
supply of MTAS from New Zealand mobile operators.
The Minister’s decision is expected in August 2010.
Please refer to:
http://www.comcom.govt.nz/mobiletomobiletermination
Resale of incumbent’s retail services
Resale services occur when the fixed incumbent operator Telecom New Zealand provides its retail
services on a wholesale basis to other telecommunications service providers.
Retail services are “designated” access services under subpart 1 of Part 2 of Schedule 1 of the
Telecommunications Act 2001, meaning that the price and non-price terms of their supply are subject
to regulation. The retail services which are currently resold by Telecom are:
 Retail services offered by means of Telecom's fixed telecommunications network (FTN);
 Residential local access and calling services offered by means of Telecom's FTN;
 Bundle of retail services offered by means of Telecom's FTN; and
 Retail services offered by means of Telecom's FTN as part of bundle of retail services.
In addition to undertaking an investigation into whether or not resale services should be omitted from
Schedule 1 (and so become “deregulated”), the Commission will also consider whether the service
descriptions of the resale services should be amended (if resale services are not omitted from
Schedule 1).
A draft report is expected in August 2010 and a final report and recommendation to the Minister in
November 2010.
International mobile roaming
In May 2010, the Minister responsible for telecommunications in New Zealand and his counterpart in
Australia released a joint discussion document on international mobile roaming between New Zealand
and Australia. The discussion document came to the preliminary conclusion that pricing transparency
was low and that prices were high.
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A number of submissions were received from industry players, consumer groups, and members of the
public. Mobile operators have also supplied traffic and revenue data. All this information will be used
to test the preliminary conclusions of the discussion document and decide whether it is appropriate to
continue to a full market analysis.
This decision should be made by the end of 2010. If a full market analysis takes place, it will likely
take the form of a consultation in late Q1 2010.
TSO/KSO
The Telecommunications Service Obligations (TSO) for local telephone service are being reviewed to
ensure that the obligations reflect the increasing consumer expectations for telecommunications
access services and to ensure the wider population can benefit from technology enhancements.
The TSO Review has now been completed and key policy decisions were agreed by Cabinet in March
2010 following public consultation on a discussion document released on 29 September 2009. The
key policy decisions were that:
 all the current Local Residential Telephone Service Obligations remain relevant and should
be retained;
 the legislative framework which provides for the cross-industry funding of TSO instruments
should be amended to provide for a fairer allocation of cross-subsidies and to consolidate
industry payments into a single telecommunications development levy (the TDL);
 the TDL should, in addition to funding TSO costs, also provide for the collection of payments
from the industry to support the funding requirements of the Rural Broadband Initiative and
upgrades to the emergency services calling system; and
 the TDL should be set at $50 million per annum until 2015/16 and $10 million per annum
thereafter.
A Bill to amend the Telecommunications Act 2001 is currently being drafted to implement these policy
decisions and is expected to be ready for introduction to the Parliament in 2010.
Broadband Initiative
UFB Initiative
The current government has committed to contributing an investment of up to $1.5 billion alongside
additional private sector investment to accelerate the roll-out of ultrafast broadband to 75 percent of
New Zealanders.
This investment is subject to five key principles:
 That this investment does not line the pockets of or give undue advantage to existing
broadband network providers.
 That the network is open-access so that many service providers can compete to provide
broadband services over it.
 That excessive duplication of the network is avoided.
 That everyday New Zealanders get affordable world-class broadband services.
 That this public-private partnership remains focused on New Zealand’s economic future and
not the legacy assets of our economic past.
On 16 September 2009, the finalised investment proposal was published. The government
established a Crown-owned investment company (“Crown Fibre Holdings or CFH”) in December 2009
to drive the government’s investment. Following an initial round of bids received in January 2010,
CHF released a revised request for proposals on 2 July 2010.
CFH will invest alongside private sector co-investors in regional or national fibre companies that will
deploy and provide access to fibre optic network infrastructure in the 33 towns and cities covered by
the initiative. The fibre companies will only operate at the wholesale level, providing access to dark
fibre and certain ‘layer 2’ wholesale services. They will be prohibited from selling retail services (and
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investment partners that own or operate retail operations will not be able to have majority voting
control in the regional fibre companies).
Until 31 December 2019, there is to be a period of regulatory forbearance from Commerce
Commission intervention under the Telecommunications Act. However:
 Fibre companies will provide open access undertakings in a Deed of Undertaking to the
Government, to be enforced by the Commerce Commission.
 Prices for the fibre access services will be those set through commercial negotiation, with
CFH, following the competitive tender process.
 The fibre companies will provide information, as required by legislation, with the Commerce
Commission to have an ongoing monitoring role.
CFH will operate an open, transparent and contestable process to select local partners, with selection
based on:
 The amount of additional fibre coverage being proposed.
 The proposed capital structure.
 Commercial viability of the proposal.
 Consistency with government objectives.
 Track-record of the partner, amongst other factors.
CFH will receive final responses to the revised Invitation to Participate on 2 August 2010.
Rural Broadband Initiative
The Government is implementing a $300m rural broadband initiative to:
 connect 97 percent of schools to fibre, enabling speeds of at least 100 Mbps, with the
remaining 3 percent to achieve speeds of at least 10 Mbps; and
 improve coverage of fast broadband services so that 97 percent of New Zealand households
and enterprises are able to access broadband services of 5 Mbps or better, with the
remaining 3 percent to achieve speeds of at least 1 Mbps.
The Government has received 39 expressions of interests for the Rural Broadband Initiative. Interest
has come from infrastructure companies from New Zealand and abroad, and includes nine substantial
expressions of interest covering the entire country. A Request for Proposals will be issued in August.
Please refer to:
www.med.govt.nz/rural-broadband
Facilitating the deployment of broadband infrastructure
The Government is exploring complementary measures to facilitate the deployment of broadband
infrastructure and reduce the costs of acquiring rights of access to land, deploying support structures
and obtaining resource consents.
Submissions and Expressions of Interest have been received on a fibre deployment standards
initiative being coordinated by the Ministry of Economic Development (MED), Crown Fibre Holdings
Ltd and the Digital Auckland Working Party. The initiative will involve the development of nationwide
standards of practice for fibre deployment, accompanied by pilot deployments around the country to
test those standards at selected locations, to facilitate the roll-out of broadband infrastructure.
It is intended that the standards developed would ultimately be fed into the National Code of Practice
for Utilities' Access to Transport Corridors (the ‘Utilities Code'), to be given regulatory status under the
Utilities Access Act 2010. The MED's preliminary view is that nationwide standards of practice would:


Enable the efficient deployment of a range of non-traditional fibre installation techniques in
New Zealand as a deployment option for the roll-out of fibre;
Create consistent rules and processes to be applied by individual local authorities across the
country; and
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
Potentially reduce UFB and RBI roll-out costs and deployment timeframes.
Please refer to: www.med.govt.nz/facilitating-broadband
Reform of the Resource Management Act and related legislation
The Resource Management Act 1991 (the “RMA”) sets out the framework within which local councils
develop district plans. District plans determine which activities require resource consent and which do
not. As such, they directly impact the roll-out and maintenance of telecommunications networks.
The New Zealand government has launched a two-phase reform of the RMA. The first phase
involved amending the RMA to streamline and simplify the current resource consent processes. This
Act came into effect on 1 October 2009. The second, more long-term phase, will examine more
complex issues inhibiting effective resource management, and may lead to further amendments to the
RMA and other legislation, or non-legislative measures.
Apart from resource consent, those deploying or maintaining networks also require agreements
(leases) with the relevant landowners. Where the land involved is a public transport corridor, such as
a road, a motorway or a rail line, a network operator’s ability to obtain such agreement is guaranteed
under certain legislative instruments. The government is seeking to reform these instruments to
further reduce the costs and inefficiencies imposed on network operators when exercising their right
of access to transport corridors.
RADIO SPECTRUM
The radio spectrum policy environment in New Zealand is delineated primarily by the
Radiocommunications Act 1989 which, in addition to providing the framework for radio spectrum
management, recognises New Zealand’s obligations to the worldwide radiocommunications
community as a signatory to the International Telecommunication Union (ITU) constitution and
convention. The Radiocommunications Regulations 2001 are subordinate to the Act.
New Zealand was the first economy to redefine radio spectrum in terms of property rights, and to
assign it in a tradable form. Property rights to spectrum are, in general, assigned competitively under
the Management Rights Regime (MRR), as either a band (management right) or as individual
spectrum licences issue by the band manager.
Spectrum allocated for other commercial purposes and for use in the ‘public interest’ by, for example,
a recent allocation of VHF and UHF spectrum for public protection and disaster relief services, is
normally assigned administratively under the Radio Licensing Regime (RLR).
Low power, ubiquitous devices – for example, garage door-openers and wireless LANs – and
community services – for example, amateur radio and CB radio – are generally assigned as shared
‘public park’ spectrum using General User Licences (GULs), in a similar manner to the allocation of
licence-exempt spectrum in other countries.
A ‘managed park’ has also been created in 2010 as a middle ground option between nation-wide
spectrum rights with exclusive access and General User Licensed bands with open public park
access. Managed Spectrum Parks (MSP) are intended to allow flexible access for a selected number
of users on a shared basis for local and regional deployment of wireless infrastructure. It is intended
to be, as far as possible, self-managed by the users. Users are required to coordinate with each other
to ensure quality of service otherwise not achievable.
Digital Television Services
Free-to-air DTH (digital satellite television) services were launched in 2007 under the ‘Freeview’ brand
using leased capacity on the Singtel Optus D1 satellite. Free-to-air DTT (digital terrestrial television)
transmissions, covering 75% of New Zealand’s population, commenced in April 2008. The satellite
and terrestrial services are complementary, to ensure complete coverage of the NZ population. Plans
for the new service were developed by government agencies and Freeview, a consortium of New
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Zealand's free-to-air broadcasters, including Television New Zealand, Mediaworks (formerly
Canwest), Maori TV, Trackside and Radio New Zealand.
The government provided some funding to assist with establishment of Freeview, but the bulk of costs
are met by broadcasters. Broadcasters also have free access to radio spectrum for digital
transmissions until digital switch-over. Freeview will operate on a non-profit basis during this period,
with open access for new services.
The government has commenced a process for determining the date of digital switch-over, and for reallocating spectrum in the television bands to enable use of the ‘digital dividend’. A firm date for
digital switch-over will be set in 2012 or whenever 75% of households are able to receive digital
transmissions, whichever comes first.
Good viewer uptake continues, with around 70% of households taking up digital services (including
pay-TV) by mid 2010.
The digital switch-over policy is detailed on the Ministry of Economic Development's website at:
http://www.rsm.govt.nz/cms/policy-and-planning/current-projects/digital-futures-planning-for-digitaltelevision-and-new-uses
New Zealand Satellite Opportunities
In November 2004 a process was announced for allowing commercial satellite operators to access
New Zealand satellite reservations and filings with the ITU. A specific application was received for
operation at 158 deg East and a contract signed with the applicant.
The applicant is currently undertaking commercial and coordination arrangements.
The satellite policy is detailed on the Ministry of Economic Development's website at:
http://www.rsm.govt.nz/cms/policy-and-planning/current-projects/archive/radiocommunicationsarchive/new-zealand-satellite-opportunities/media-statements/nzlsat-gets-satellite-go-ahead
Managed Spectrum Parks
Having finalised the rules and application documentation on the operation of the Managed Spectrum
Park (MSP) in the 2.5 GHz band, the Ministry of Economic Development invited applications from
local and regional players to access the MSP in March 2009. Applications closed on 4 September
2009 and eighty licences were awarded to the successful applicants on 1 February 2010 on a
provisional basis.
Allocation process and timing of future licences within the MSP are currently being worked through.
For more information on MSPs please refer to:
http://www.rsm.govt.nz/cms/policy-and-planning/current-projects/radiocommunications/managedspectrum-parks
High Capacity Short Haul Point-to-Point Links in the 70-90 GHz band
The band was identified as a candidate band for broadband wireless services by MED in July 2006,
as part of the wider broadband work programme. In September 2008, a follow-up discussion paper
was released which focused on the 70 to 90 GHz band. Submissions were received from three
stakeholders, including one equipment supplier and two major network operators. Submissions have
helped to resolve a number of administrative and technical issues around the management of access
to the band.
In mid 2009, MED changed licensing policies to permit licensing of fixed point-to-point links in the 70
to 90 GHz band under the administrative licensing regime.
Please refer to:
http://www.rsm.govt.nz/cms/policy-and-planning/current-projects/archive/radiocommunicationsarchive/70-90-ghz-fixed-links/
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Re-planning of non-cellular services in 806-960 MHz Band
In May 2009, MED published a discussion paper examining options for re-planning some non-cellular
services in the 806-960 MHz band. The proposals aimed to improve utilisation of the band and
facilitate adoption of new technologies. The Ministry received 23 submissions on the paper.
The outcomes of the review were announced by the Minister for Communications and Information
Technology on 24 June 2010 and are summarised below:
Changes for short-range devices and Amateur service
The General User Radio Licence for short-range devices has been amended to allow for the following
uses:

868-870 MHz – SRDs with a peak power of 2 mW e.i.r.p. and a maximum duty cycle of 1% [to
operate on a non-interference basis with existing use by land mobile radio in the 868-869
MHz range]

921.5-928 MHz – SRDs with a 1 W maximum transmitter power, employing FHSS or digital
modulation, may operate up to a maximum of 4 W e.i.r.p. with a gain antenna [currently
restricted to 1 W e.i.r.p.]
The frequencies 928-929 MHz will be removed from both the SRD and Amateur GURLs. This will
come into force on 12 August 2010.
Around approximately the end of 2015, these additional changes will be made:

915-921 MHz – allow SRDs with a peak power of 1 W e.i.r.p. and Amateur service with a
peak power of 25 W e.i.r.p. [currently used for studio-to-transmitter links]

920-921.5 MHz – allow SRDs with a 1 W maximum transmitter power, employing FHSS or
digital modulation, to operate up to a maximum of 4 W e.i.r.p. with a gain antenna.
Changes for studio-to-transmitter links
As indicated above, the 915-921 MHz band currently used for studio-to-transmitter links (STLs) will be
opened for SRDs around approximately the end of 2015. At that time, existing licensees will not be
required to exit the band, but they will have their protection from interference removed.
This means that licensees will need to assess if their STL is in a location that is likely to be at risk of
interference from SRDs. If so, they will need to either obtain a licence in a different STL band, or use
a different technology to transport their programme from the studio to the broadcast transmitter (e.g.
leased lines, infra-red links, microwave radio, satellite linking).
Two new frequency ranges have been indentified for use by STLs, in addition to the 849-851 MHz
and 929-935 MHz bands already allocated in this band:

841-849 MHz, and

928-929 MHz.
The Ministry of Economic Development (MED) intends to open these bands before the end of 2010,
so that users transitioning out of the 915-921 MHz band can relocate if they wish. Before opening the
bands, the Ministry will develop coordination guidelines to manage the 840 MHz interface between
cellular mobile services and STLs. This will be done in consultation with Telecom (which owns the
825-840 MHz management right) and STL licensees.
For more information on the 806-960 MHz re-planning, please refer to:
http://www.rsm.govt.nz/cms/policy-and-planning/current-projects/radiocommunications/806-960-mhzband-replanning
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Review of the Radio Licensing Regime
In July 2009, MED concluded its review of the administrative spectrum assignment system. No major
changes to the regime were proposed as a result of the review. The regime had not been subject to
comprehensive review since the Radiocommunications Act 1989 came into effect (however, various
aspects of the regime had been examined as part of the reviews in 2000 and 2005).
Evidence from a discussion document and technical report, MED experience, and submissions from
stakeholders suggested that the regime as a whole is working well. Stakeholders largely endorsed
the way the Ministry approaches issues, such as congestion, when they arise. There are a few
instances where supply may not be currently meeting demand, but these can continue to be
addressed on a case by case basis (such as studio-to-transmitter link spectrum in major centres,
currently being reviewed in the review of the 806-960 MHz band, discussed above).
MED also intends to explore options for minor improvements to the regime, including: ongoing
reviews of demand, in order to address bottlenecks before they occur and enable new technologies
as they emerge; consideration of regional management rights and geographical overlay and underlay
services; developing a process for requests by prospective radio users to free up unused spectrum;
and estimating the value of particular spectrum bands with a view to benchmarking economic
efficiency.
For more information please refer to:
http://www.rsm.govt.nz/cms/customer-support/latest-news/expired-items/review-finds-radio-licensingregime-working-well/
Digital land mobile radio in VHF and UHF bands
MED is facilitating introduction of digital LMR technologies into the commercial land mobile bands
located in the VHF and UHF parts of the radio spectrum. A discussion paper was released to seek
feedback and twelve submissions were received. Land mobile bands assigned for government
purposes (public protection and disaster relief) have already introduced digital LMR. MED is
proposing to align New Zealand’s licensing framework for commercial digital LMR with international
practice.
Having analysed industry submissions received, the ministry has released a report outlining the
proposed licensing arrangements to accommodate digital land mobile radio in the VHF and UHF
bands.
For the Report on Outcomes please refer to:
http://www.rsm.govt.nz/cms/policy-and-planning/current-projects/archive/radiocommunicationsarchive/digital-land-mobile-radio-in-vhf-and-uhf-bands/report-on-outcomes
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