Chorus in, Sky TV out in companies named liable for rural telco levy

Commerce Commerce names 29 companies that are "potentially liable persons" for the Telecommunications Development Levy

Sky TV has escaped having to contribute to an industry levy for rural telecommunications, but Chorus must pay up.

The Commerce Commission has named 29 potentially "liable persons" for the $50 million Telecommunications Development Levy (TDL) for the 2011/12 year. The levy replaces the previous funding mechanism for the Telecommunications Service Obligation (TSO) and will be used to help fund the Rural Broadband Initiative.

The levy is to be paid by public network operators earning more than $10 million a year. In the first draft of the Commission’s report the broadcaster Sky TV was named as a potential ‘liable person’ but following industry feedback, the Commission has concluded that “content providers do not, merely by allowing end-users to access their content and information... provide a public telecommunications network.”

“As the legislation states, only fixed or wireless public network operators qualify for the levy. The list of 29 companies therefore includes the new local fibre companies and Chorus, but excludes Sky and other content providers as they are not telecommunications network operators,” says regulation general manager John Hamill.

Chorus had argued that it should be immune from the paying the first year of the levy because it was not trading as independent company last year, a view supported by the Telecommunications Users Assocation of NZ (TUANZ), but roundly denounced by other industry players.

The Commission has concluded that Chorus was “trading” in the 2010/11 year and is therefore liable. See full report here.

The Commission will now consult on what revenue will count toward sharing out the $50 million levy obligation.The list of liable companies is as follows:

• Actrix Networks
• Airnet NZ
• Bay City Communications
• CallPlus (Slingshot)
• Chorus
• Compass Communications
• Crown Fibre Holdings (Whangarei Local Fibre Co, Ultrafast Fibre)
• Datacom Systems
• Enable Networks
• FX Networks
• Gisborne.net
• Inspire Net
• Kordia (Orcon)
• Maxnet
• Network Tasman
• Optus Networks
• Snap Internet
• Teamtalk (Araneo, Citylink)
• Telecom
• TelstraClear
• thepacific.net
• Transpower
• Trustpower (Kinect)
• Two Degrees Mobile
• Vector Communications
• Verizon New Zealand
• Vodafone
• Woosh Wireless
• WorldxChange