Chorus Cuts Fiber Prices, Announces Debt Relief Fund for Retail Service Providers
Chorus will reduce the price of its wholesale fiber products over the next three months and provide support to Retail Service Providers (RSPs) on the bad debts they have accrued during the lockdown.
Reduced pricing and a delayed increase are expected to save RSPs around $10 million, and the foreclosure debt package worth an additional $2 million.
Wholesale fiber pricing for Gigabit, Chorus’ fastest growing plan, will increase from $60 per month to $56 per month starting July 1, 2020. Gigabit is already the fastest growing plan of Choruses.
The annual increase in the regulated consumer price index for fiber products will be delayed until October 1, when the price of 100 Mbps fiber will increase from $46 to $47.15.
Chorus will consult with RSPs on this change over the next two weeks.
The price of fiber for small businesses will be reduced by $3 per month to $52 from July 1, acknowledging the pressure that SMBs are facing.
Price changes only affect wholesale and the decision to pass on reductions or increases to consumers rests with the RSPs.
Chorus CEO JB Rousselot said the changes strike the right balance between passing savings on to RSPs, while allowing for continued investment in infrastructure.
“We recognize the critical role Chorus’ infrastructure has played during the lockdown, and we believe this combination of price changes will support RSPs, allow Chorus to continue to invest in the capacity, reach and resiliency of the fiber network, and will also allow more customers. to qualify for higher spec plans,” he said.
The $2 million debt relief fund was intended to help RSPs who chose not to cut customers who were unable to pay during the lockdown.
“We support the decision taken by some providers not to cut off customers during the lockdown, which in some cases has seen customers’ debt to them increase, potentially leading to higher than usual non-payment rates,” he said. said Rousselot.
“We have said throughout that Chorus will play its part in supporting RSPs who were facing the risk of increased bad debt due to the lockdown,”
The fund represents an estimate of the increased risk of bad debt incurred by the industry, for the lockdown period, based on retailer feedback and other industry analysis.
Chorus is not the only supplier to delay price increases. Cloud accounting firm Xero also recently announced an indefinite postponement of planned price increases to its Starter, Standard, and Premium plans that were to take effect July 1.
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