Copper exchanges, such as this one in Nelson, are on the way out.

Copper phone and internet services could start be axed completely from some parts of New Zealand in less than two years, as fibre-to-the-home takes over, a select committee has recommended.

The select committee on Friday released its report on a huge overall of telecommunications industry rules.

Most of the new rules may not kick in until 2022, but the select committee said network companies should be allowed to start withdrawing copper services from January 2020, in areas that were declared as "fibre-areas".

They would have to abide by an industry code, which has yet to be written.

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The code would be designed to ensure the interests of customers who had not yet made the switch away from copper services were protected.

RACHAEL KELLY/STUFF Fibre-optic, wireless or mobile broadband could be the only mainstream broadband options in some parts of New Zealand from 2020 as copper services are withdrawn.

The intended revamp of the Telecommunications Act has pitched the interests of network companies such as Chorus against those of major retailers such as Spark and Vodafone.

Vodafone NZ chief executive Russell Stanners made his first appearance at a select committee in his 17 years at the helm of the company in March, warning the legislation as originally drafted could see Chorus reborn as "old Telecom".

However, the committee struck a compromise on the companies' different interests in its report.

It disappointed Vodafone by refusing to recommend the Government grant retailers access to Chorus' raw fibre-optic cables on terms set by regulators – so called "layer-one bundling".

Vodafone NZ chief executive Russell Stanners accused Chorus of "bait and switch" over wholesale UFB pricing during intense lobbying over new telecommunications rules.

There were fears layer-one unbundling could benefit larger internet providers such as Spark, Vodafone and Vocus and thereby make it harder for smaller rivals to compete.

But the committee advised against the wholesale removal of "line of business" restrictions on Chorus that currently prevent it from getting more involved in delivering new telecommunications services in greater competition to companies such as Vodafone and Spark.

Instead, it has suggested allowing the Commerce Commission to grant specific "case by case" exemptions to the existing restrictions on Chorus.

Stanners said Vodafone was "especially pleased" with that proposed change, though the company still thought the committee had got it wrong on layer-one unbundling.

Chorus chief executive Kate McKenzie said it would review the recommendations "with interest".