Telecom NZ unveils $NZ1.4 billion broadband plan

Stuart Corner
Sunday, 28 October 2007 13:57

Opinion and Analysis

In Australia telecommunications policy is on the backburner until after the election, full operational separation of Telstra is still only an academic discussion and Telstra's FTTN rollout has been officially on hold for two years. Meanwhile across the Tasman, it's a different story.

For years, telecommunications in New Zealand was viewed by many on the Australian side of the ditch as a bit of a disaster. While Australia had introduced market liberalisation in stages accompanied by a huge raft of legislation to curb the market power of the monopoly, over in New Zealand Telecom NZ's monopoly was swept away in one fell swoop with standard competition law left to carry the full burden of restraining its market power.

Perhaps the nadir of this era was when an access dispute between Telecom NZ and its largest competitor, Clear Communications, wound its laborious course through the New Zealand Courts over several years, only to be finally decided by the Privy Council in London!

In recent years, the situation has changed dramatically and now New Zealand appears to be far more forward looking in its telecommunications regulation. After refusing for years to introduce telecoms-specific competition rules, the Government finally bit the bullet in a big way and decided to impose operational separation on Telecom NZ. Faced with the inevitable, Telecom NZ embraced the concept wholeheartedly and has been working overtime to meet the Government's timetable

This week it lodged its draft operational separation undertakings with the Government  and simultaneously announced that, over the next four years, it would deliver fast broadband to every town and city in New Zealand, based on a next generation network.

New CEO, Paul Reynolds, said: "Operational separation brings some tough requirements, but is good for customers because it promises more choice; good for New Zealand because it promises new investment; and good for Telecom because we can compete in an environment in which the need for any future regulation is greatly reduced. Operational separation has given Telecom the opportunity to re-plan its broadband strategy and accelerate the upgrade of the existing network in ways that will support New Zealanders' aspirations for the digital age."