Broadband Targets

One welcome part of the speech from the throne was:

With respect to ICT, my government will be advancing policies to ensure that the telecommunications sector becomes more competitive and that we achieve faster broadband uptake in line with our competitors.

The Commerce Commission decision on unbundled bitstream will help to some degree. However Telecom has claimed the pricing model is unlawful which means they may seek a court review of the final determination, if unchanged.

I think Telecom are playing a very dangerous game. It is very clear they will not meet their target of one third of broadband connections being wholesale through other ISPs. Hence they have somewhat audaciously have claimed they never actually agreed to that as a target!! The Commerce Commission and the Government are far from impressed and have rebutted the claim.

If I was Telecom I would stop fighting the UBS determination (note I appeared on behalf of InternetNZ in support of the draft determination so I represent an interested party, but my comments are honest opinion). The reason why they should is that when they fail to meet their target, they can say to the Minister “Well the Commerce Commission determination (due mid Dec) has just come out and this will increase uptake, so there is no need to look at any further regulatory measures, and let’s just see in six or twelve months where we are at”.

But if Telecom do seek a court review of the Commerce Commission determination then it will not be made available until well into 2006. And the Government having promised pre-election to take action will have no option but to look at further regulation. So Telecom faces a very real possibility of winning the battle but losing the war, as the rules of engagement will be changed by the Government.