19 May 2004

Govt blocking telecommunications progress

Green MP Sue Kedgley says the Government's decision to not remove Telecom's monopoly over the telephone network and open it up for competition would hold back innovation in the telecommunications sector and the development of high-speed, competitively priced broadband services.

In response to the Telecommunications Commissioner's report on the issue last December, Communications Minister Paul Swain today announced he would not 'unbundle' Telecom's local network but claimed he would allow Telecom to sell 'wholesale broadband services' to its rivals.

"New Zealand and Mexico are the only OECD countries that have not taken the decision to open up telephone services to true competition," said Ms Kedgley, the Green Party Spokesperson on Communications.

"All other developed countries have already moved to unbundle their local loop, because competitive access to the copper wire network is considered vital in the development of an Internet economy.

"The Minister is being quite disingenuous when he says he will now allow Telecom wholesale broadband. 128Kbps upstream/256 Kbps downstream is insufficient for home business use, so it's hardly broadband access at all.

"The Government says it is committed to an open, competitive market for telecommunications, but rather than riding the Knowledge Wave, it continues to keep a key part of our telecommunications infrastructure closed to competition. In our view, the Minister should have come out in favour of opening up the entire telephone network and sent the Commissioner's recommendations back for further consideration.

"The Minister's decision means that New Zealanders are being denied access to innovative services because the dominant player in the market has a monopoly over a key piece of telecommunications infrastructure that was built up over many years by the taxpayer," said Ms Kedgley.

ENDS

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