NZ broadband plans eclipsed by Bledisloe barbs

Beverley Head
Friday, 21 August 2009 12:43

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In a speech long on Bledisloe Cup barbs, but short on specifics, the New Zealand prime minister John Key wasn’t giving much away about New Zealand’s future internet intentions during a major speech in Sydney today, except to acknowledge that “the internet changes everything.”  

The prime minister addressed the Trans Tasman Business Circle in advance of an historic joint Australia-New Zealand cabinet meeting being held in Sydney this afternoon. Australia’s minister for broadband, communications and the digital economy, Senator Stephen Conroy was one of several Australian ministers in the audience, but if he expected to learn more about New Zealand’s long term broadband plans he would have been disappointed.

While Mr Key maintained that that the internet was “our greatest threat and our greatest opportunity” he did not discuss in any detail the progress of NZ’s planned $NZ1.5 billion broadband investment initiative. That investment, which the government expects the private sector to at least match, is intended to underpin the roll out of fast broadband to 75% of the New Zealand population within 10 years.

Mr Key outlined his own internet epiphany which occurred during his time at investment bank Merrill Lynch. “I ran the low margin but highly profitable homogenous businesses for Merrill Lynch; the global foreign exchange and bond business.”

He said that the bank’s board quickly recognised that the internet would disintermediate that business and introduce new levels of competition.

Mr Key said, “I think one of the reasons we had the global credit crunch is that investment banks - which generally made large amounts and paid their people large amounts -   in an attempt to keep the earnings and level of compensation, took larger levels of risk, more complex risk – it wasn’t just the sub prime market.

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