I’m speaking this afternoon at the Tel Con 11 Conference in Auckland, spelling out Labour’s position on the Govt’s new Telco laws and its fatally flawed plan to deliver ultrafast broadband to 75% of New Zealanders.
Criticism is mounting of the Bill and the general plan. It appears that telecom remains its only champion. Even then I’m not so sure about their commitment.
Steven Joyce, the Minister remains obdurate and blinkered. He’s said he’s not interested in what the industry says. He’s doing it for consumers. Not so sure theyr’e going to get a good deal though.
Here’s a couple of differing views. RadioNZ reported:
One of New Zealand’s biggest telecommunications companies is stepping up its criticism of the way the Government is setting up ultra-fast broadband.
The Government will spend up to $1.5 billion rolling out fibre-optic cabling to three-quarters of homes by 2019.
TelstraClear has put a two-page advertisement in the New Zealand Herald, the country’s biggest daily newspaper, picturing a rugby scrum and a referee standing nearby who has been bound with rope and gagged with masking tape.
TelstraClear chief executive Allan Freeth says he supports fibre to the home, but is worried about the way the governments Telecommunications Amendment Bill removes the Commerce Commission’s ability to regulate the new network for 10 years.
Dr Freeth describes it as a regulatory holiday, and says it is unhealthy because it is anti-competitive, and will result in fewer choices and higher prices for consumers using the new fibre network.
and then there was Telecom’s view. Which was all about them, not about the industry.
Telecom chief executive Paul Reynolds says his industry has gone from being the “darlings” to the “dogs” of the technology world as risks turn investors away.
At a telecommunications summit in Auckland yesterday he said new investment was drying up worldwide.
“Our industry finds attracting capital increasingly difficult. You’d be better putting it in the bank, you’d be better putting it in agriculture, because the returns [in telecommunications] are difficult to come by.”
That’s interesting, becasue I understand that during the early part of the negotiations last year a signficiant offer was put on the table to purchase part of Telecom’s assets by a potential bidder.This new investement was part of an innovative bid which could have already started delivering fibre to build our new network.
Reynolds speaks out of both sides of his mouth and Joyce is a dogmatic CEO (who happens to be in parliament) who hasn’t worked out that building consensus and buy-in is an important part of achieving your goals.
‘Telecom chief executive Paul Reynolds says his industry has gone from being the “darlings” to the “dogs” of the technology world as risks turn investors away.’
The industry or his company?
Telecommunications is necessary infrastructure and as such should not be done by private profit making companies due to the risks of super profit and lack of maintenance (what we’ve seen from Telecom over the last 20 years) and the dead weight loss of profit. Continuing on in the belief that competition is possible in such a natural monopoly is nothing short of insanity.
Infrastructure can only be profitable when it’s a monopoly as adding competition will reduce users (income) and increase costs (advertising for each individual company and the cost of extra networks all of which is an unnecessary drain on the whole economy). This is why our telecommunications was a state monopoly before deregulation by the 4th Labour government.
it is also why it was one of the worst performing in the world at the time – the rest of the economy was dead in the water and not able to attract capital, while the Post Office was wasting money, ignoring services to its customers, and not accountable to its owners.
sure it was not well privatised and there were a lot of problems with the social/commercial balance (a lot of that was regulatory uncertainty, which things like reg holidays or contracts in Aus aim to address), but services definitely improved.
can’t really blame telecom for wanting certainty of a return before they ask investors to risk $ in exposure to NZ’s schizophrenic monopoly profit regulation…