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Business Sector Expected To Match Govt Investment -- Institute

Fuseworks Media
Fuseworks Media

By Sharon Lundy of NZPA

Wellington, March 31 NZPA - Business think tank the New Zealand Institute believes the private sector will at least match the Government's $1.5 billion investment ultra-fast broadband.

Communications and Technology Minister Steven Joyce announced today public-private partnerships would be established to deliver ultra-fast broadband to 75 percent of New Zealanders within 10 years.

The Government would establish a Crown-owned investment company, Crown Fibre Investment Co (CFIC), to handle its investment, Mr Joyce said.

"Under the proposal, CFIC will invest alongside private sector co-investors in regional fibre companies that will deploy and provide access to fibre optic network infrastructure in the 25 towns and cities covered by the initiative."

The broadband roll-out is a National election commitment and it has set aside up to $1.5 billion to achieve it.

New Zealand Institute research director Benedikte Jensen welcomed the announcement and said he was confident the Government funding "will be matched by at least an equal amount of private sector investment to transform access to broadband services for New Zealanders".

"The institute has previously estimated that a high-speed broadband network would generate additional economic value of $2.7b to $4.4b each year, with further gains possible through enabling innovation," Mr Jensen said.

"The proposed investment in broadband is a crucial step to propel New Zealand on to a higher growth and productivity path coming out of the recession."

Telecom chief executive Paul Reynolds said today's announcement would be welcomed by all players in the market.

"We will now evaluate and assess the proposal in detail as we begin to prepare our formal submission to government," he said.

"Specifically, Telecom will be reviewing the opportunities the initiative presents to work with the proposed CFIC to extend the reach of Telecom's own ultra-fast broadband network, and to utilise the fibre networks others may build."

Telecom supported the Government's vision of delivering high broadband speeds to New Zealanders and was investing $1.3b this year in improving the country's telecommunications infrastructure.

Prime Minister John Key said the initiative would give internet speeds of up to 100 megabits per second -- "for most people, speeds which are quantum faster than anything they currently have".

"They will be able to watch TV comfortably and easily over their computer screens, they will be able to run businesses from home..."

The move would bring New Zealand into the 21st century, enabling it to compete with countries such as South Korea, Singapore and Hong Kong.

"We are a small country, we are a long way away and if we want to connect with the world in the cheapest, most efficient way possible, we have to have world-class broadband capability."

Mr Joyce has called for feedback on the proposal, with interested parties having until April 27 to make submissions.

The 25 centres identified are based on population and range from Auckland, with 1.2 million people, to Oamaru, with 12,681. Nowhere smaller than Oamaru would be considered.

Those in areas outside the 25 identified would eventually get better services but that would be in the second phase of the initiative. They could expect faster broadband but would not have the fibre enabling the ultra-fast broadband, Mr Joyce said.

The 25 centres, in order of population, are: Auckland, Christchurch, Wellington, Hamilton, Napier and Hastings, Dunedin, Tauranga, Palmerston North and Fielding, New Plymouth and Hawera, Kapiti and Levin, Nelson, Rotorua, Whangarei, Invercargill, Wanganui, Gisborne, Cambridge and Te Awamutu, Blenheim, Timaru, Taupo, Masterton, Whakatane, Ashburton, Tokoroa, and Oamaru.

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