Govt risks broadband and operational separation in muddled process

The Government must explain the timing of its announcement about Telecom’s request to structurally separate and whether this has compromised the tender process for its $1.5 billion broadband rollout,” Labour ICT spokesperson Clare Curran says.

“The Government needs to reveal whether parallel discussions have been held with Telecom about structural separation while a closed tender process is underway to roll out ultrafast broadband to 75% of New Zealanders,” Clare Curran said.

“There are many questions for both Telecom and the Government to answer following Telecom’s announcement today that it is considering structural separation in order to participate in the rollout bid.

“The public needs to know to what extent the Government was aware of these plans and whether there has been any dialogue with Telecom. What market sensitive information does it and Telecom now have and have they met their Securities Act disclosure requirements?"

"Other bidders also need to know the implications for their CFH offers and whether the Government has acted in good faith. The bidders for the UFB have spent millions preparing their bids in good faith.

"Telecom’s announcement today suggests that a parallel process has been underway for months which could undermine the tendering process. The $1.5 billion being invested in ultrafast broadband is public money and the public has the right to a transparent process on how it will be spent.

"It doesn't stack up for Telecom to now say copper based services have no future when the entire business case around its Next Generation Network was based on enhanced, cabinetised high speed xdsl copper services.

“Caution must also apply to any suggestion the Crown should own part of Telecom’s entire core network or access layer. Whatever the situation with Telecom, the decision around who gets to rollout fibre for NZ’s broadband network must be made with the public interest in mind.

“It must not be a decision to bail out a troubled telco or deliver profit to shareholders, especially if those shareholders are not New Zealand based.

ENDS

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