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									Space Management
Part II
Grooming, Market Share Assessment &
Draft STD space management is costly,
difficult and impractical

 •   Key elements of TCF paper, which were reflected in STP, have been
     overlooked in the draft STD

 •   The space management components of grooming, market share
     assessment and rationalisation are too complex and would drive
     cost into Chorus and our customers

 •   Some of the key processes are simply unworkable

Key TCF Recommendations have been

•   The TCF recommended funder priority in new cabinets to give
    those who fund a cabinet confidence that they can utilise the space
    they require for their business case. This was overlooked by the
    Draft STD.

•   The TCF agreed First come first served (after funder priority). The
    Draft STD makes this conditional on an overriding 50% cap and a
    complicated market share assessment.

•   The TCF agreed Use it or lose it for inactive equipment and
    specifically dismissed rationalisation as being too costly and
    disruptive. The Draft STD introduces rationalisation of space to
    reflect market share.

Draft STD space management is too
complex and costly to operate
 •   The draft STD introduced a complex and impractical space
     management regime, that will require considerable resource to
     manage. The regime includes:
      • Preliminary, conditional and final orders all with notification
      • Guaranteed occupancy notices and period management;
      • Market Share assessments;
      • Rationalisation notices; and
      • Grooming notices

 •   The complexity of the process would generate confusion, be costly
     and very difficult to manage, and drive errors and disputes.

 •   Importantly, the regime would not solve the problem it seeks to
     address. Complex cabinet co-location situations cannot be sensibly
     addressed by complicated and inflexible rules.

Market Share process is impractical
•   The Market Share Assessment process is used at several points to
    determine space available for allocation. As the organisation required
    to manage the regime, Chorus does not consider it to be workable,
     • Cabinets are small and DSLAM equipment comes in fixed sizes, not variable
       to match market share percentages;
     • Chorus has no visibility of the wholesale market data required for the
       calculation and no way of validating information provided by our customers;
     • Once calculated, the result may be vetoed by the cap;
     • The Market Share assessment is locked in for a year so could limit growth to
       25% per annum whereas some areas experienced growth of greater than
       100% per annum; and
     • Ignores SLES exchange based services.
•   The TCF agreed a market share allocation in some cases. This will
    need further consultation on the impact of information sharing under
    operational separation.

Space management should not be
prescriptively regulated
•   Grooming and Rationalisation can be costly and disruptive:
     • Service outages required to relocate either equipment or termination blocks
       must be coordinated with Chorus, our customers and end users
     • Chorus must be able to recover the cost of grooming from our customer
       requesting the groom as we have no other way to fund this expenditure
     • It may not be practical for our customer to rationalise equipment and hard
       rules may produce perverse results. Cabinet co-location is a complicated
       business case, not suited to one-size-fits-all rules.
     • Case by case solutions will be more sensible in the circumstances.

•   Our customers have indicated that 10 days is far too short a
    timeframe in which to rationalise their equipment.

•   The sensible solution is to give Chorus the chance to work with our
    customers to develop workable, cost effective solutions in each case.

Space management and rationalisation
  • Rationalisation is complex and, as our customers have indicated, will
    require long lead times.

  • Those leads time may vary from case to case.

  • Our customers may have to relinquish end-users where, for example,
    they are required to rationalise equipment that cannot support all their
    customers, or where they have gained customers between the date of
    the market share assessment and the date of rationalisation.

Space management by Chorus
•   We support all the agreements made by the TCF, including:
     • Funder priority
     • First come first served
     • Use it or lose it

•   Chorus is a professional network operator acting in its own
    commercial interests. We’re in the business of providing co-location
    space to our customers.

•   The operational process should be sufficiently flexible to allow
    solutions to be tailored to our customers’ circumstances, achieve cost
    efficiencies and reduce the risk of errors and disruptions.

•   We need the flexibility to manage our cabinets effectively and meet
    our customers’ needs. We should not be required to implement
    complex rules which may drive perverse outcomes.


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