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Calls for Telecom to Open Network

Posted on: Sunday, 5 February 2006, 15:00 CST

By STEEMAN, Marta

Telephone firms are urging the Government to review the issue of Telecom opening its network after it failed to meet a critical government target on high-speed internet services.

Telecom has fallen short by 20,000 of a government target to have 83,300 "broadband" (high- speed connections) wholesale customers by the end of 2005. The target is a measure of how much competition Telecom faces in the New Zealand market in this new telecommunications area.

The target was part of a commitment by Telecom after the Government rejected forcing Telecom to open its local copper network (unbundling) to rival operators. Telecom fought unbundling tooth and nail, resulting in the Telecommunications Commissioner rejecting unbundling and the Government accepting the recommendation.

TelstraClear chief executive Alan Freeth said New Zealand's broadband story was a disaster, and it was hampering economic growth and productivity. "We call for a speedy review of the regulatory environment by the Minister (of Communications David Cunliffe) with the introduction of unbundling soon afterwards so New Zealanders can access the type of services enjoyed by our overseas counterparts," he said.

TelstraClear, and other telephone firms, said New Zealand's business broadband services were the second most expensive in the Organisation for Economic Development (OECD), behind Mexico.

New Zealand consumers were accepting internet speeds packaged as broadband, but the speeds were not much faster than dial-up internet, he said. Mexico was the only other nation without unbundling.

Unbundling was the way to drive broadband uptake and lift New Zealand's performance to the top half of the OECD, Freeth said. "Telecom's claim it is delivering New Zealand a strong and growing broadband story is an unconvincing attempt to fool New Zealanders into thinking things are better than they are."

Cunliffe is doing a stock-take of New Zealand's telecommunications performance against the rest of the world, which will be completed by July. But there whether he reviews unbundling is debatable.

Ihug chief executive Mark Rushworth said Telecom missing the broadband target by 20,000 should send a message to the Minister that his review of the telecommunications regulatory regime was even more critical.

Unbundling was the only way for Kiwis to received faster broadband speeds for less than a dollar a day. Ihug's parent in Australia was able through unbundling of Telstra Corporation's network to provide their customers 24 megabit speeds for $A29.95 ($NZ33.24) a month. The speed was nearly 100 times faster than Telecom's Xtra's 256 kilobit speed which New Zealanders were paying up to $50 a month for.

Slingshot chief executive Annette Presley said New Zealand had some of the world's slowest broadband speeds. The broadband uptake was rising faster in most other nations.

Source: Press, The; Christchurch, New Zealand

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