CHORUS LIMITED — Capital/Financing Update 2013

May 14, 2013

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MEDIA RELEASE

Chorus Limited Level 9 Datacom House 68-86 Jervois Quay P O Box 632 Wellington New Zealand Email: company.secretary@chorus.co.nz

15 May 2013

Chorus launches mass market VDSL product as step towards fibre

Chorus has today announced new pricing and specifications for a VDSL-based broadband product.

VDSL is a broadband technology on the existing copper network that can provide much faster download and upload speeds than existing ADSL2+ technology.

Following extensive consultation with the industry, Chorus VDSL will be offered from June 7 2013 as part of the BUBA product family under the UBA Standard Terms Determination, aligning its pricing with the current EUBA wholesale price. The Retail Service Providers (RSPs) will take this wholesale input price and develop their own plans and pricing to market VDSL to end users.

“Supporting the RSPs to offer their customers much faster broadband speeds today is an important stepping stone towards the fibre future,” said Victoria Crone, GM Sales and Marketing, Chorus.

“The new Chorus VDSL product will provide more New Zealanders with the opportunity to enjoy higher speed connections, and also make New Zealand a more attractive market for the development and deployment of high bandwidth applications that will drive us towards the fibre future,” said Victoria.

“The industry experience is that better broadband stimulates demand for even greater speed and bandwidth, so we’re confident that the better broadband experience offered by Chorus VDSL will encourage migration to fibre’s superior service as it becomes available.

“In some areas fibre will not be available until 2019, so in those regions Chorus VDSL provides an important interim step. It will also provide many end users in areas that are not currently included in the Ultra-fast Broadband (UFB) initiative with the opportunity to enjoy faster speeds,” she said.

VDSL speeds and availability

Speeds will vary depending on distance from Chorus’ broadband equipment in the exchange or cabinet. About two-thirds (or 1.2 million) of Chorus’ lines are within reach of VDSL capability of 20Mbps or greater.

“VDSL technology also has significant potential in rural areas, and is a natural complement to the Rural Broadband Initiative, because about 55% of the 400,000 premises outside of UFB areas will be within reach of Chorus VDSL at the end of the Rural Broadband Initiative roll out,” said Victoria.

End users should contact their RSPs to ascertain availability of VDSL broadband at their properties.

Chorus currently has around 3000 end users on VDSL technology.

Migration to fibre

Chorus will offer VDSL in all regions until mid-2015, and stop selling it progressively as the fibre roll-out is completed in areas where Chorus was selected for UFB.

“Fibre is the superior technology and we are clear that VDSL is a stepping stone to fibre. As such, we are offering VDSL in Chorus UFB areas in the interim, but will not sell any new VDSL connections once our fibre build is complete in Chorus regions,” she said.

Chorus may also review the ongoing provision of VDSL if its continued availability affects fibre uptake in Chorus’ UFB areas.

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ENDS

For further information:

Ian Bonnar Corporate Affairs Manager Phone: +64 9 358 6061 Mobile: +64 (27) 215 7564 Email: ian.bonnar@chorus.co.nz

Brett Jackson Investor Relations Manager Phone: +64 4 498 9271 Mobile: +64 (27) 488 7808 Email: brett.jackson@chorus.co.nz

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