Monday, April 17, 2006

Hugh Ritchie: Deja vu in rural fight for access to broadband

To farmers around the country, the debate about what to do to Telecom to help drive competition in the telecommunications market has a sense of deja vu.

Electricity reforms a decade ago professed the same belief that regulation would somehow bring lower prices and better service to all New Zealanders.

The reality for rural New Zealand has been far from the vision espoused by the government of the time.

Hands up anyone who thinks they have a cheaper electricity bill or that we have a more reliable power supply. That concept could fit nicely on a Tui billboard.

If the Government moves to regulate Telecom in the manner at present being discussed, why should farmers expect the outcome to be any different to that experienced with their electricity supply?

One of the main regulation options being discussed is local loop unbundling. In simple terms, this is where Telecom's competitors can get access to Telecom's copper network and run their own broadband services over it.

If Telecom's network is unbundled, can farmers and their families really continue to expect Telecom and other companies to invest in getting broadband services to rural New Zealand?

It makes sense that increased competition would see companies try to cherry-pick the highest-value customers, customers who by and large live in the cities.

We hear from Telecom's competitors about how unbundling will price broadband more competitively, but we are yet to hear how much it will commit to invest in rural broadband coverage.

The reality is that real growth in rural uptake of broadband will occur only when rural people are paying the same lower prices that urban people pay.
As well, the telcos must recognise that it is important for salespeople in towns and cities to access farmers, just as much as farmers need to access them.

Good broadband access for farmers is good business for farmers and the businesses they do business with in cities. Banks, insurance companies, accountants, airlines - you name it - most businesses want to transact business online.

If you're the BNZ, AMP or Air New Zealand, you should want your rural customers online.

Federated Farmers is convinced there were significant failures in policy when assets were sold to Telecom. Too little regard was given to the needs of rural New Zealand and for the on-going investment in infrastructure nationwide.

If another review is on the agenda, it must take proper and comprehensive account of the need to deliver quality and affordable telecommunications for the 80,000 farmers and growers New Zealand depends on.

So let's get a bit of measure back in to this debate.

Let's look at the needs of all New Zealanders, and not just the city-dwellers. It's in this country's best interests that affordable, reliable telecommunications are accessible to everyone.

We have a unique opportunity to get this right for New Zealand. Let's make the best of it.

* Hugh Ritchie is a Hawkes Bay farmer and Federated Farmers spokesman on telecommunications.

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