29 October 2009 Media Statement

Progress on new broadband company but concerns remain about Telecom’s role

The newly announced board of Crown Fibre Holdings seems balanced between a traditional Telco and a wider infrastructure-based approach to rolling out ultra fast broadband, but significant questions remained about the role of Telecom, Labour IT and Communications spokesperson Clare Curran said today.

Crown Fibre Holdings is the company established to manage the Crown's investment in ultra-fast broadband infrastructure over the next ten years.

“The new chair of Crown Fibre Holdings, Simon Allen is well regarded and respected, along with Dr Murray Milner, who has 34 years experience in the telecommunications industry and is a respected consultant,” Clare Curran said.

“Keith Tempest, the CEO of Trustpower, an electricity company, provided balance to the telecommunications bias.

“I do though have some concern about the influence of Treasury on the roll out of ultra fast broadband, which is known to favour a traditional Telco approach, possibly led by Telecom, which is a vertically integrated monopoly. “

Clare Curran said the previous Labour’s Government’s decision to operationally separate Telecom was designed in such a way for further structural separation to occur down the track.

“There has been pressure on Telecom in recent weeks by Communications and IT Minister Steven Joyce to voluntarily agree to a structural separation. But Telecom is said to be resisting this,” Clare Curran said.

“We understand there was a difference in view between Treasury and the Ministry of Economic Development on the approach to the rollout. MED is believed to favour a wider infrastructure approach, whereas Treasury is inclined to support a more traditional telecommunications model.”

Clare Curran said Labour would be watching the new Crown Fibre Holdings Company closely to determine how it would manage the rollout.

“New Zealand’s economic future relies on a successful rollout of broadband, and we must demonstrate we can do this equitably so that the vast majority of New Zealanders can take advantage of the opportunities it provides,” Clare Curran said.

“It is arguably one the most important pieces of infrastructure to be introduced this century. It’s more than telecommunications, it’s core infrastructure. And we must get it right.”

ENDS

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