The [[Commerce Commission]] recommended against local loop unbundling in late 2003 as Telecom New Zealand (now [[Spark New Zealand]]) offered a market-led solution. In May 2004 this was confirmed by the [[Fifth Labour Government of New Zealand|Government]], despite the intense ["call4change"<ref>{{cite web |url=http://www.call4change.co.nz/ |title=Call for<!--sic--> Change |date=February 2004 |url-status=dead |archive-url=https://web.archive.org/web/2005112805275620040926051624/http://www.call4change.co.nz/ "call4change"]|archive-date=2004-09-26 |access-date=14 August 2022}}</ref> campaign by some of Telecom's competitors. Part of Telecom's commitment to the Commerce Commission to avoid unbundling was a promise to deliver 250,000 new residential broadband connections by the end of 2005, one-third of which were to be wholesaled through other providers. Telecom failed to achieve the number of wholesale connections required, despite an attempt by management to claim that the agreement had been for only one-third of the growth rather than one-third of the total.<ref>{{cite webbook |chapter=3. Trade Policy |title=One-ThirdPolicy Framework for Investment: A Review of Good Practices |author=OECD |date=24 August 2006 |chapter-url=https://www.oecd.org/daf/inv/investment-policy/40287346.pdf |access-date=23 July 2018 |url=https://www.oecd.org/investment/investmentfordevelopment/policyframeworkforinvestmentareviewofgoodpractices.htm}}</ref> That claim was rejected by the Commerce Commission, and the publicised figure of 83,333 wholesale connections out of 250,000 was held to be the true target. The achieved number was less than 50,000 wholesale connections, despite total connections exceeding 300,000.
On 3 May 2006 the Government announced it would require the unbundling of the local loop. This was in response to concerns about the low levels of broadband uptake. Regulatory action such as information disclosure, the separate accounting of Telecom New Zealand business operations, and enhanced Commerce Commission monitoring was announced.<ref>[{{cite press release|url=http://www.beehive.govt.nz/ViewDocument.aspx?DocumentID=25636 |work=Beehive –|first=David |last=Cunliffe |agency=Government of New Zealand |date=3 April 2006 |title=Government moves fast to improve broadband<!-- Bot generated titleBroadband |url-->] {{webarchivestatus=dead |archive-url=https://web.archive.org/web/20071117061320/http://www.beehive.govt.nz/ViewDocument.aspx?DocumentID=25636 |archive-date=November 17, 2007 |access-date=14 August 2022}}</ref>
On 9 August 2007 Telecom released the keys to exchanges in Glenfield and Ponsonby in [[Auckland]]. In March 2008 Telecom activated [[ADSL 2+]] services from five Auckland exchanges – Glenfield, Browns Bay, Ellerslie, Mt Albert and Ponsonby – with further plans for the rest of Auckland and other major centres, allowing other ISPs to take advantage.
