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The broadband revolt

Written By: - Date published: 12:50 pm, April 12th, 2011 - 16 comments
Categories: leadership, Steven Joyce, telecommunications - Tags: ,

One of the Nats’ few constructive policies at the last election was Steven Joyce’s ultra-fast broadband project. The Nats promised $1.5 Billion investment to deliver UFB to 75% of New Zealand homes within 10 years. Almost 3 years in, their proposals have just been met with almost universal rejection:

Telcos, consumer groups oppose fast broadband plan

New Zealand’s leading telecommunications companies and consumer groups have united against the government’s ultra-fast broadband (UFB) proposals.

Telcos are bidding for a part of the $1.5 billion for the network through Crown Fibre Holdings and will then build a network of fibre optic cables to the home throughout the country. But most of them, along with Federated Farmers, Consumer New Zealand, Internet NZ and the telecommunications users group TUANZ, have written a joint letter to all ministers calling for urgent action.

The letter said: “The only bodies that support the current Bill are those that hope to receive public money to build UFB. That tells an obvious story and should encourage you to look very closely at this legislation.”

TUANZ CEO Paul Brislen told TVNZ today they are concerned about the 10-year “holiday” from regulation that the successful bidders will get.

“In our view the regulatory holiday should be scrapped or at the least substantially modified, and the consumers’ champion – the Commerce Commission – should be allowed to do its job,” he said.

Brislen says a regulatory holidays means the Commission will not be able to look at pricing until 2020 which could trap people into high broadband prices.

Vodafone, 2 Degrees, TelstraClear, Call Plus, Kordia/Orcon, Opto Network and Torotoro Waea are all signatories to the letter.

The group says it fully supports broadband infrastructure investment but has grave concerns the current plans will “cause a dramatic reduction in competition and investment in the New Zealand telecommunications market”.

How did Joyce and the Nats get it so wrong?

16 comments on “The broadband revolt”

  1. windy.city.struggler 1

    How did Joyce and the Nats get it so wrong .. give it to their supporters at Telecom NZ <slash> Xtra  .. “those that hope to receive public money to build UFB ?
     
    Is that what they imported that gentleman from Scotland for ?
     
     

  2. Draco T Bastard 2

    How did Joyce and the Nats get it so wrong?

    Oh, that was easy – they were intent upon resurrecting Telecoms monopoly position so as to put it back into the super-profits that they had in the 1990s.
     
    Of course, Labour and the other parties aren’t doing to well either – they’re still looking to produce competition within a natural monopoly rather than going the rational route and renationalising telecommunications.

  3. infused 3

    You really have no understanding in what’s going on. It’s not fiber to the door anymore and hasn’t been for along time. Also, the other players don’t have the capacity to do the work.

    • lprent 3.1

      Yep, it it has been fiber to the cabinet ever since the Nact’s got in and quietly reneged on their impossible promise. In fact it is just as was planned prior to the NAct’s putting their moronic oar in. What Nact have managed to do is to simply delay everything by about 2-3 years.

      Tell me infused – why do you support these incompetent dim wits?

      • Colonial Viper 3.1.1

        I support National’s broadband plans because I have a large shareholding of Telecom stock. How about you guys?

        • lprent 3.1.1.1

          Are you hoping that the price will rise to your purchase price again?

          (I got rid of my Telecom stock quite some time ago. In fact the whole family did. Effective monopolies are only viable businesses in the short term. )

          • Draco T Bastard 3.1.1.1.1

            But telecommunications is a natural monopoly. This is proved by the fact that it wasn’t until LLU was legislated that Telecoms share price dropped. If that hadn’t happened that share price would still be high and Telecom would, most likely, still not be rolling out fibre to the cabinets (which they’re only doing now because it maintains their monopoly).
             
            Telecommunications should never have been deregulated and Telecom should never have been sold.

            • Colonial Viper 3.1.1.1.1.1

              Are you guys now advising that I sell my Telecom shares and purchase Meridian when this lot flog it off at bargain basement prices?
               
              I think it is a good idea too. I reckon I can count on the new major foreign shareholders to jack power prices up through the roof to extract the most value they can from the little people of this country. Oh I’m rubbing my grubby dividend eager hands with glee!
               

              Are you hoping that the price will rise to your purchase price again?

              touché

              • Jim Nald

                I remember when, once upon a time, my father’s Telecoms shares were at the $9 mark.
                Around the current price of $1.980 and thanks to the lovely National Government’s mega-monopoly in the making with the ’10-year holiday’ going ahead, and having lotsa tax-cut money sloshing around, whoop whoop, this is a good time to buy buy.

  4. Jum 4

    The only reason Joyce is in cabinet is because he spun Key into there.
     

  5. Gareth 5

    Yip they’ve sure botched this up.
    I want UFB fast, like tomorrow, but I’m happy to wait to make sure a robust and durable cross-parliamentary process is developed. Sorry about the cross-post but how about a political truce?

  6. Frank Macskasy 6

    The greatest irony in this whole issue is that, on the one hand, National tells the public that state subsidies for businesses are a no-no – they must survive or perish in the cold Wellington Breeze of the Free Market (ok, ok, stop your sniggering – bear with me for a moment).
     
    But then they launch a policy to pay private enterprise $1.5 billion of our taxes to build broadband up and down the country.
     
    Whoa! Back up there, pardnuh!!
     
    If we are living in a Free Market economy and if this guvmint is so staunch in promoting the Free Market – why are we subsidising telecos to build something which they should be doing?!
     
     

  7. Name (Required) 7

    Here in a remote and very rural area the community go so fed up with virtually unusable dial-up and no prospect whatever of any alternative (apart from hugely expensive satellite) that we funded, built and now run our own wireless broadband network.  eg 4GB >5MBps = $25/month with a year-end divi of surplus funds.
    We were in line for a grant under the Labour Govt’s. broadband scheme to extend our network (mountain-top solar-powered relay sites aren’t cheap even with voluntary labour, freely-loaned diggers &tc) but the wheels of that ground too slowly (probably because the Treasury had the handbrake on and let all the air out of the tyres) and the first thing the new National Govt. did was throw the whole scheme overboard and spend the money subsidising UFB to the banks, insurance companies and marble-clad offices in the main CBDs.
    We’ve tried to see if we can get a few $k to extend our network in to areas that effectively have no Internet at all (10k tops, but $5k would enable us to make a difference) but no – the whole $1.5 billion is earmarked for the big Telecoms who will spend it laying fibre to homes that could already have ADSL2+ which is five times faster than anything we have and more than fast enough for anything apart from streaming movies which the world lived quite happily without until a couple of years ago.
     
     
     

  8. gnomic 8

    Shurely shome mishtake here? This UFB, shouldn’t it be called Fairly Fast Broadband Sometime Really Soon Now if you don’t mind waiting a bit? Otherwise known as a misnomer. Ultra Fast Hah! Just another porky propagated by one Not A Genius Joyce. Shurely right up there with other great masterpieces of NZ governance like the leaky buildings farce. How do these cowboys get away with this crap? Is there something in the water? And has anybody noticed that there will be an entry fee of several hundred dollars (initially at least) to buy the new gizmo required to access the Fairly Slow New Fabbo Broadband? It’s just pass the sickbag I’m afraid. Not to mention the sad fate of our country cousins. Will that even be Fast, let alone Ultra Fast?

    Anti-spam word ‘concern’. Is that thing psychic?

    • Jim Nald 8.1

      the way you painstakingly and graphically describe it, UFB is swiftly and successfully turning into Ultra Fast Bullshit

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