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Call for sense and perspective in UBS debate

InternetNZ calls for sense and perspective in UBS debate

Media release – for immediate release Wednesday 2 November 2005

"The latest comments by some industry groups on the broadband market are deeply disappointing, because they pay scant attention to the facts involved," said InternetNZ President Colin Jackson today.

Mr Jackson responded to comments from Business NZ, Vector and Federated Farmers among others, as reported in the New Zealand Herald this morning, stating "It is vital that three sets of facts are kept in mind."

"Firstly, Telecom's network investment is driven by what is good for Telecom. Protecting the interests of the incumbent telecommunications carrier is not the job of the Commission: promoting competition in the interests of end users is."

"UBS and even DSL are only one part of a range of technologies that give access to broadband Internet. Many other options are available to 'last mile' consumers, including wireless and satellite access. In any case, Telecom’s continuous 'threats' to hold up investment if more competition arises have a credibility similar to that of their contention that free local calling causes New Zealand’s low broadband uptake. That argument was firmly rejected by the OECD, and this argument is equally as weak."

"Second, Telecom already offers full speed broadband connections in rural areas, wherever it is technically feasible. This poses exactly the same risk to 'reach' as an unconstrained UBS service availability would do. Our technical advisors believe such risks are negligible in any case."

"Finally, a single price point cannot lead to a single retail offering. The cost of accessing the UBS is only one component of the costs making up a broadband Internet service. Different bandwidth options, backhaul and so on all affect the cost, the quality of service and ultimately the price people are willing to pay. This is a deeply misleading straw man argument, which we are very disappointed to see being iterated by Business NZ. Their analogy of any DSL product being akin to a limousine is highly inflammatory, as ADSL is known internationally as an equivalent to a 1950's Ford Prefect."

"The UBS issue is straightforward. Those making comment should seek to understand the technical arguments before making comments which end up assisting Telecom to deny consumers better broadband at lower cost. Rather than responding in line with Telecom's repeatedly misleading statements, commentators should adopt a bit of sense and perspective," Colin Jackson concluded.


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