Leaving out major telcos raises doubts about broadband plan

Without network operators like Telecom playing a meaningful role in the National Broadband Plan there has now been doubt cast over the viability of the Governments latest plan.

There are now serious concerns as to how the government has structured the process which is designed to build a super-fast broadband network that will require minimal regulatory intervention and will be open to any competition from rival telecoms providers according to Rosalie Nelson, a telecommunications market analyst.

Nelson advised “It feels to me that the process that they’ve set up now creates some very significant commercial barriers to the existing telecommunication players that have sunk fibre actually participating at all.”

The plan to only allow the benefit of the $1.5 billion in taxpayers money to go to broadband network builders who had no retail business was again confirmed recently by Stephen Joyce, the IT and communications Minister.

Shareholders would gain control over any money or assets that were offered to the government to allow for partnership by telecoms providers that did have retail arms.

Nelson Advised “There isn’t any promise or commitment to roll back existing legislation and, yes, there is the sweetener of $1.5 billion, but it’s really hard to see if that is going to be enough.”

The total cost would be likely to hit $6 billion according to Telecommunications Industry Group, which consists of operators like Vector, Vodafone and Telecom.

The biggest concern at the moment was that many of the big network operators would refuse to take part in the plan, which appears to be something that TelstraClear has already indicated it will do, and in situation where it is commercially sensible to do so, will expand their own fiber network and build out fiber to the premises.

Source – Nz Herald