Clare Curran
Spokesperson for Communications and IT
23 March 2011

New Zealanders will face higher prices for their existing phone and broadband services for almost a decade if a controversial new telecommunications law is passed, Labour’s Communications and IT spokesperson Clare Curran said today.

“I have been advised that the passage of the Telecommunications (TSO, Broadband, and Other Matters) Amendment Bill will see a price hike of at least five dollars a month on the average phone and broadband bill for many consumers.This new law will stifle competition in the copper market, while the vast majority of Kiwis will not be able to access fibre for up to a decade.

“Despite the Government’s promise before the last election that 75 percent of Kiwis would receive ultrafast broadband in their homes, the Minister confirmed today that this could not be guaranteed until the end of 2019. In the meantime, their existing copper-based services will increase in price while the service won’t.

“As if Kiwis didn’t have enough to worry about with hikes in food, electricity and petrol prices, they now face artificially increased prices for their broadband and phone while the Government presses through with its ill-advised telco laws and hands enormous powers to the Communications Minister as well as to New Zealand’s biggest telco, Telecom.

“The effect of Steven Joyce’s new law is to re-average prices for the current copper based broadband services which will mean the price of broadband over copper will increase in urban areas by more than 20 percent.

“A damning submission by the Commerce Commission to a select committee hearing last week also concluded that the effect of re-averaging copper pricing meant that further investment in the copper network would be frozen. The outcome for New Zealanders is dire. The government is investing in a new fibre network which won’t be available to the bulk of New Zealanders for much of the next decade.

“The Government seems likely to hand the construction of most of the new network to the major incumbent telco Telecom, which does not have a good record of investing in networks and has been dogged for years by harsh criticism of its pricing and anti-competitive behaviours.

“Labour is fighting the new telco laws amid rising public criticism of their impact on consumers and the industry. We have previously announced our opposition to the proposed 10 year regulatory holiday on price setting for fibre until the end of 2019 and pledged to review it should we win government later this year.”

ENDS

© Scoop Media