11 Mar 2014

Chorus's UFB contract tweaked

11:59 am on 11 March 2014

Chorus and Crown Fibre Holdings have agreed on some changes to Chorus's contract to build about 70 percent of the ultrafast broadband network, or UFB.

The changes include allowing Chorus greater flexibility in how it rolls out the network and more regular payments to it by Crown Fibre Holdings.

Chorus says the changes don't require any additional funding, nor do they change its underlying contractual obligations to complete the network before December 2019.

Chief financial officer Andrew Carroll says the changes don't amount to a single silver bullet and he can't put a specific dollar figure on their value to Chorus.

However, he says they will help his company address its $1 billion funding gap.

Meanwhile, Chorus has appointed two existing executives to replace departing sales and marketing general manager Victoria Crone, who is going to Xero to become the accounting software company's New Zealand managing director.

The company says product and market development manager Mike Lott and head of sales Mark Tod will take joint responsibility for Ms Crone's role while a replacement is found. Ms Crone will leave at the end of March.

Chief executive Mark Ratcliffe says Chorus has a marketing and sales staff of about 50 people looking after about 100 customers who spent more than $1 billion a year.

"In most areas that we operate in there is a degree of competition," he says, "and of course in 30 percent of the country the Government is sponsoring other people to be local fibre companies to build over our network there, so we think sales and marketing is a pretty integral function - and whilst we have monopoly positions in some markets, in general there's competition about."