Fisking Clare

Clare Curran has blogged at Red Alert:

Communications and IT Minister Steven Joyce has just told the House in question time that there has been no delay in rolling out ultrafast broadband.

It’s amazing how this government can tell a barefaced lie with a straight face. The election was almost a year ago. The $1.5 billion delivery of broadband to 75% of New Zealand homes was a core election promise. Supposedly ready to go!

If Clare is going to use terms like bare faced lie, I’m going to have to point out how that description is one which better applies to her own blog post.

John Key announced the ultrafast broadband policy in May 2009. I was there when he did it. So was most of the industry. And they know what John Key said. So they get very puzzled when Clare claims the broadband package was supposedly ready to go. Let me quote John Key’s speech:

Delivering on these five principles will require a carefully thought-through and negotiated investment and regulatory model. National will conduct these negotiations in our first year of government.

2009 is the first year of Government. If anything, Steve Joyce is three months ahead of schedule. Everyone in the industry knows that National said the policy was a policy about what they wanted to achieve, and they would take 12 months working out the best way to achieve it.

And frankly it is somewhat bizarre that Clare keeps demanding that decisions should have been made quicker, because she has also blogged what an incredibly complex area this is. If the Government had made decisions more quickly, I suspect Clare would criticise that. Being in Opposition does not mean you have to criticise everything.

Clare then compounds things by claiming:

They axed the previous Government’s programme which was poised to rollout and put everything on hold for months while they recast a plan which now looks remarkedly like the previous government’s. That’s taken all year.

Now I was a big supporter of most of what the previous Government did in the Communications/IT field. But it is not at all correct to claim the previous Broadband Investment Fund is the same as what National is doing. The previous fund was not for a national fibre network reaching 75% of New Zealanders. It was $325 million (compared to $1.5 billion) and was not for fibre to the home. It was for mainly broadband to businesses and MUSH (municipalities, universities, schools and hospitals).

Now that was a good fund and certainly better than doing nothing (from my point of view). But to be blunt National trumped that with a policy that was far more ambitious and with far more funding – around 400% more.

Personally I suspect the former Minister, David Cunliffe, would have loved to have matched or exceeded National’s policy – but the simple fact of the matter is he couldn’t get the extra funding out of Clark and Cullen.

So while there are of course some similarities between the former BIF and the current Government’s proposal (mainly that they both use a regional competive process which is hardly surprising) they are in no way the same plan. And again, most people in the industry know this.

This government talks about investing in infrastructure. It seems to think that infrastructure is purely the network of roads, wires or fibre required to create a physical structure. What Mr Joyce, who is also the Associate Minister of Infrastructure, doesn’t seem to get, or pays lipservice to, is that with broadband, you can just invest in the fibre. You’ve got to invest in what will pass through the fibre. Services that will benefit society. And that’s the government’s role.

I’m not sure what Clare is suggesting here but I don’t want the Government competing with telcos, ISPs, Sky TV etc etc as the applications and services level. The infrastructure level, which is inherently non-competitive in most cases, is where I want the investment to happen.

It’s unknown whether the private sector investment required to make up the shortfall between $1.5 b and $6 billion will manifest itself, because its unknown what level of public investment will be made in the health, education and enregy sectors which will stimulate demand. That’s the real question.

No it is not. Expecting the Government to declare today what services it might seek to deliver in ten years time over the network is incredibly naive – especially considering the pace of change in the Internet industry. Any declaration today is likely to be more inaccurate than a Treasury forecast of the deficit!

The private sector will make their investment decisions on the basis of international experience and their own market research. They will not make them on the basis of what the Government may do online in ten years time.