The Commerce Commission today released a telecommunication service obligation (TSO) Cost Calculation Determination for the Local Residential Telephone Service covering the 2008/09 year. The draft cost is $69.7 million.
The change in the corporate tax rate from 33 per cent to 30 per cent in the 2008/2009 TSO period resulted in a lower pre-tax WACC for the 2008/2009 TSO period compared to that in the 2007/2008 TSO period. This has been the major contributor to a lower TSO cost from that calculated in 2007/2008.
Under the TSO Telecom is obliged to provide certain local residential telephone services to residential customers who may not otherwise be provided with those services at an affordable price. The TSO allows Telecom to recover its costs of providing this service.
The total net cost for 2008/09 will be shared according to the final TSO Cost Allocation Determination for 2008/09 which is available on the Commission’s website. The costs will be shared amongst the following: Telecom, Vodafone, TelstraClear, WorldxChange, Compass, CallPlus, Woosh, Teamtalk, Airnet and Two Degrees Mobile and Link Telecom.
Interested parties are invited to make submissions on the 2008/09 draft TSO Cost Calculation Determination. The closing date for submissions is Friday 15 January 2009 at 5pm.
A copy of the Commission’s draft determination is available on the Commission’s website www.comcom.govt.nz under Industry Regulations/Telecommunications/ Telecommunications Service Obligations