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Failure to meet wholesale broadband target proves need for a new regulatory settlement

Media Release - February 2, 2006 - "Today's announcement that Telecom has failed to meet its self imposed target for wholesale broadband uptake proves that competition is still a long way away for Kiwi consumers," InternetNZ President Colin Jackson said today.

He was commenting on Telecom statistics showing that only 63,000
residential wholesale broadband connections were in use by 31 December
2005. Telecom had previously pledged to deliver at least 1/3 of 250,000
– 83,000 connections – by the end of last year.
“This is further clear evidence that the existing light-handed
regulatory framework is not delivering a competitive marketplace for
broadband services. Telecom is still by far the dominant provider, and
only fundamental regulatory reform will deliver better prices and
faster services for New Zealanders.
“While it is commendable that Telecom have exceeded their total
target for connections, the effect of this is simply to reinforce their
dominance in the market.
“Telecom’s wholesale commitment has not been met. The current
regulatory framework has not delivered, and cannot do so. A radically
different regulatory settlement is needed to deliver competition, lower
prices and real broadband services to the market.
“The government has been clear for some time that it was taking Telecom’s 83,000 wholesale target seriously.
“In July last year, Hon David Cunliffe, Minister of Communications made the following comments:
‘Let me be very clear on this. This Government regards world-class
broadband infrastructure as a critical national capability for the 21st
‘[T]he Government regards a healthy and competitive broadband
wholesaling market as essential. Telecom New Zealand's wholesaling
commitment is important, and a response will follow if it is not met.’

“InternetNZ looks forward to the government’s response, when it
announces decisions arising from its ongoing stakeholder review of
telecommunications regulation,” concluded Colin Jackson.
Colin Jackson, President, 021 393 685

Keith Davidson, Executive Director, 021 377 587

Hon David Cunliffe quote:

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