Chorus agrees UFB package improvements

Chorus has today announced a package of improvements to the UFB initiative have been agreed with Crown Fibre Holdings that ensure the roll-out is more cost effective, provides better outcomes for end users and eliminates some barriers to take-up.

The initiatives do not require any additional funding from CFH, change the underlying contractual obligations to pass all premises in Chorus’ coverage area before December 2019, or change the network requirements.

The two organisations have been working together, as requested by Communications and Information Technology Minister Amy Adams in December 2013, to take the lessons learned from the first two years of the UFB initiative and make a series of improvements that will benefit all parties.

“This initial set of initiatives will help Chorus to deliver UFB faster, smoother and more cost effectively,” says Andrew Carroll, CFO, Chorus.

“While Chorus is firmly focused on managing its costs, both parties have worked on the basis that we need to find innovative ways to deliver better outcomes, and that would require a degree of give and take.

“We all want UFB to be an enormous success and these improvements are an important step towards that.

“They give Chorus a greater degree of flexibility to manage its own costs effectively while still achieving the same outcomes and also facilitating the uptake of UFB.

"In particular, this flexibility will enable Chorus to better manage its cash flow through the peak of the balance of the capital intensive period of the build, as well as addressing some of the $1 billion funding gap.

“There is no one silver bullet that will address this issue, but several small incremental changes all help towards navigating a very challenging period. At this stage it is not possible to put a specific dollar value to Chorus on the changes as it is dependent on a range of factors, but we thank CFH for its flexibility in supporting Chorus.

“While some of these initiatives have been accelerated by the funding gap Chorus faces, several of them were already under discussion as both parties were looking to further streamline the build.

“We will continue to work closely with CFH to identify further improvements that enable both parties to deliver great outcomes for New Zealand,” he said.

The changes are effective from 11 March 2014.