IOG Meeting Overview - October 2008

    The fifth IOG meeting was held in Wellington on 3 October 2008. This overview summarises matter considered by the IOG at that meeting.

    Update on Separation Milestones

    The IOG considered the status of those Separation and Equivalence Milestones due 1 July that were still under review by the Support Office.

    The IOG was advised that Milestones due 30 September 2008 would be considered at the next meeting as the quarterly Telecom status report was not due until 17 October.

    Customer Service address classification breach (Telecom Zones)

    The Telecom Zone Breach Schedule 1, Part A 1.1 Definitions has been resolved to the satisfaction of the Commerce Commission.

    Chorus legal and regulatory resources

    The IOG noted that the Support Office do not have a detailed review of this currently scheduled. It will be considered for inclusion in the 2009 Assurance plan.

    Wholesale relevant services on website

    The IOG resolved that the failure to publish the relevant service “Radio Communication (Non-mobile) Co-Location” on the Chorus website until 8 July was a trivial breach.

    Annual Certification by Chorus that it has sufficient resources

    Certification has been received in accordance with requirements.

    Processes for Chorus relevant services and/or the access network requests

    The IOG noted that a Support Office review is underway.

    Appointment of the Auditor of the IOG Annual report

    The IOG noted that Telecom has not yet finalised the appointment of the Auditor.

    Register of Commercial Policy

    The IOG noted that the Support Office has received an updated register from Telecom that identifies the commercial policies likely to have a material impact on relevant services.

    Update on Equivalence Milestones (Schedule 1)

    UCLL

    The IOG noted the signed Statement of Work for the development of the ANS Inventory Management System for UCLL has been received. The IOG also noted that UCLL Backhaul and Co-Location were specifically excluded from the Statement of Work. This is not considered to be a breach. The IOG note that Telecom is preparing a change request to add Backhaul and Co-Location to the Statement of Work.

    BUBA

    The delivery of BUBA (full launch) as per schedule 1, 8.1 is still being considered by the Support Office.  BUBA was delivered on 8 July 2008 as required however Telecom advised that six functional aspects were not delivered.  The Support Office is considering the impact of this and determining how to ensure all other STD requirements are met.

    Audit and Assurance Reviews

    The Support Office reviewed Telecom Wholesale and Chorus Incentive arrangements and found the arrangements to be compliant with clauses 35 and 60 and Schedule 5.  However, actual business unit targets for 2008/09 are yet to be set and the final conclusion on compliance has been deferred until this is completed.

    Complaints and Honesty Box Summary

    Service Provider Complaints

    As noted in the August meeting report, a Service Provider complained that a Wholesale UBS promotion reduced the cost of a Telecom broadband promotion and that Telecom Retail appeared to have had advance knowledge of the Wholesale UBS promotion that was not available to Service Providers.   The IOG investigation found no evidence of inappropriate behaviour.

    Honesty Box Process – an introduction

    Telecom set up an Honesty Box process from 1 July 2008 which is designed to meet the whistleblowing requirements of the Undertakings.  This process enables Telecom employees to raise issues around compliance with the Undertakings which are independently investigated by Telecom (or the Support Office if the Telecom staff member chooses).  Once Telecom complete their investigation it is passed to the Support Office for their review.

    Both Telecom and the IOG have been surprised by the volume of items being reported by Telecom employees via the Honesty Box.  The IOG’s view is that the volume of matters raised demonstrates Telecom staff are taking their Undertaking requirements seriously and raising queries through the Honesty Box process.  To date the vast majority of queries are either not breaches or clearly trivial/de minimus breaches.  However, the Support Office will review each Honesty Box query to ensure appropriate analysis of each query has been performed by Telecom.

    Non-trivial breaches

    The IOG Support Office did not identify any non-trivial breaches during the reporting period (from 1 August to 30 September 2009).

    Trivial breaches

    There were a small number of trivial breaches that involved the accidental sharing of Wholesale or Chorus Commercial Information or Customer Confidential Information but did not impact on Service Providers.  For example;

    • the disclosure of Wholesale and Chorus Commercial information in a company wide invoice distributed to project managers outside of Wholesale and Chorus; and
    • Transfield and Downers employees occasionally forwarding completed service orders for Wholesale customers to Retail by mistake.

    Investigations

    165 Undertakings related items were reported directly to the IOG between 1 July and 25 August by employees using Telecom's Honesty Box process.  At the time of the October meeting, the IOG Support Office had completed investigating 117 of these items.  83 of the investigated items were not breaches.  The remaining 34 items all involved the same issue noted above where Transfield and Downers employees occasionally forward completed service orders for Wholesale customers to Retail by mistake.  Telecom is implementing changes to reduce the likelihood of this error.

    848 Undertakings related items were reported for investigation by Telecom between 1 July and 29 August by employees using the Honesty Box.   At the time of the October meeting:

    • Telecom had completed investigating 733 of these items; and
    • the Support Office had reviewed and accepted Telecom’s completed investigation assessment on 365 items and was either continuing its review or seeking further information from Telecom in respect of the remaining items;
    • none of the remaining items are considered to be significant, and the majority are unlikely to be breaches.   

    Industry Perspective

    There were no industry guests at this meeting.

    Other Matters Considered

    Planning for 2009 Audit and Assurance

    The IOG reviewed a proposed 2009 Support Office Audit and Assurance plan.  The IOG Support Office, in conjunction with external advisors, prepared the plan following interviews with a range of Undertakings stakeholders which identified the Undertakings issues of most importance to them. The IOG identified several matters to be clarified and asked the Support Office to bring the revised plan to the December meeting for final approval.

    Key Performance Indicators (KPIs)

    Following previous discussions on KPIs between Telecom and the IOG, Telecom presented proposed KPIs to the IOG’s August meeting.  The IOG provided some feedback and expected to review Telecom’s revised KPIs at the October meeting.  However Telecom subsequently advised the IOG that it will provide revised KPIs for the IOG’s December meeting.  The IOG has written to Telecom expressing concern about the delay. 

    Securities Protocol Deposits

    In response to feedback from Service Providers, Telecom proposed entering into a single security arrangement with any Service Provider who is purchasing services from both Wholesale and Chorus (rather than two separate security arrangements).   The IOG resolved that the proposed single security arrangements do not raise any issues of concern.

    Workforce Management

    Telecom considers that the Workforce Management 30 September tracking milestone could be interpreted as requiring Telecom to select a technology for Workforce Management before designing the Workforce Management process.  In Telecom’s view, it is preferable to design the process before assessing what technology may be required to support it.  Telecom has proposed an alternative approach to meeting the December 2010 Workforce Management milestone.  The IOG understood Telecom’s concerns and resolved that Telecom’s planned approach to achieving its enforceable Workforce Management milestone does not raise any issues of concern.  The IOG will continue to monitor Telecom’s progress towards the enforceable December 2010 milestone.  The IOG requested that Telecom propose interim milestones outlining how they will achieve the enforceable milestones.

    IOG Website

    The IOG asked the Support Office to consider guidelines for publishing material on its website giving consideration to British Telecom’s practices and the principles of openness and transparency.

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