Wellington, Sept 16 NZPA - The Government blueprint for managing its $1.5 billion investment in ultra-fast broadband released today won much praise but left many people wondering what Telecom's role will be.

Potential partners and industry lobby groups released statements in support of the Government plan, while Telecom expressed disappointment and warned of the potential for network duplication.

The Government rejected suggested structures from Telecom and Vodafone in deciding that a new Crown-owned investment company called Crown Fibre Holdings will select partners and manage the Government's investment in 33 regions.

Crown Fibre Holdings and partners will establish local fibre companies to deploy fibre networks. Partners could include iwi, council-owned companies, and electricity and gas companies.

The Government said it will not invest in fibre companies that are controlled by shareholders who also operate retail telecommunications businesses.

The Government statement posed the question would Telecom have to structurally separate its network to participate and answered "any such decisions are up to Telecom".

Telecom said the model announced today appeared to preclude its involvement, just 18 months after operational separation of its business formally came into effect. This raised the issue of the relevance of the operational separation undertakings.

"The Government has reiterated its wish to avoid duplication of existing, privately funded world-class network infrastructure across New Zealand," chief executive Paul Reynolds said.

The model set out today raised the distinct possibility of just such an outcome, he said.

Telecom's share price fell as much as 9c to $2.59 on the announcement but ended unchanged at $2.68. Vector chief executive Simon Mackenzie welcomed the structure and said his company, which already provided a fibre network in Auckland to businesses, was interested in being a partner in Auckland. "Because of our assets like gas and electricity we have the ability to utilise those assets to provide fibre," he said.

WEL Networks, Velocity Networks and the Hamilton Fibre Network said today that they had formed a partnership to roll out ultrafast broadband to rural areas through the Waikato region.

The Telecommunications Users Association said the plan would usher in the most fundamental change to telecommunications since the privatisation of Telecom 20 years ago.

The Government wants to roll out fast broadband services to 75 percent of New Zealanders within 10 years.

The Telecommunications Industry Group said this would cost $6 billion, meaning industry partners would provide $4.5 billion.

The New Zealand Council for Infrastructure Development said the structure should ensure rational co-investment by the Crown and private sector providers.