4 March 2006
Version
1.0 – 23 February 2006
For: Council on 4 March
2006
Status: Public
The Committee has met at least four times since the last Council meeting. Rather than focus on all the on-going work of the Committee I want to devote this report to our major work-stream in the area of the telecommunications regulatory review.
The Government’s decision to ask sector groups such as InternetNZ for a “stocktake” submission was unexpected but welcome. The timing was highly challenging as we were asked just before Christmas to have a submission done by the end of January.
The end result has been a submission which provides real intellectual leadership to the debate, and feedback on the submission from key stakeholders has been extremely positive.
All members of the Public Policy Committee have contributed to the submission. The Committee met to consider an initial framework and then a draft paper and after consultation a final paper. While it has been a group effort, it is appropriate to highlight the major contributors have been Simon Riley from Council and Jordan Carter from the staff. They should both be credited for their work.
Two teleconferences were held with experts from North America, the UK and Australia. These were also very useful inputs into the process, as was the input from our lawyer Michael Wigley.
The public meetings also proved genuinely useful. They were not just a mirror to hear our views reflected back but provided some excellent additional material. I found the Christchurch meeting especially useful as the attendees all came from affected industries, had not previously been involved with InternetNZ, and gave many examples of non-price barriers currently experienced by industry.
During this time we also had two major announcements by Telecom. The first was that they had reached agreement with Telstra-Clear on UBS provision. Our response was that it was a good deal for both Telcos but that we were disappointed for Internet users and smaller ISPs that the settlement was for lower speeds and higher costs than the Commerce Commission determination.
However it is worth noting that despite that, the deal still was a huge improvement over the status quo with existing ISP resellers. The download speed increased to 3.5 Mb/s, the price differential between business and residential was removed, and minimum technical standards achieved. I consider the $100,000 or so spent on supporting the Commerce Commission action to have returned benefits of at least a magnitude greater to the local Internet community.
However even those achievements paled in comparison to the new packages announced by Telecom in February. Business plans dropped from up to $2,400 a year to around $100 a year. Upload speeds finally increased from 128 Kb/sec and download speeds moved from a slow crawl to a gentle walk.
We welcomed the new packages but made the point that they don’t negate the need for reforming the regulatory environment but indeed reinforce the need for reform as it is better to get the market incentives right than rely on threatening the stone with a stick to get blood out of it!
As we have noted publicly there is a widespread consensus on the need for change. InternetNZ’s key challenge in the next few months will be to:
Meet as many stakeholders as possible to build support for some or all of the specific proposals we have put together
Engage in dialogue with the groups not supporting change
Maintain a high level of awareness of the issue with the public through the media, especially closer to the time the Government will make key decisions
An ad hoc meeting to discuss a “campaign plan” has already been convened by me and was held with an experienced lobbyist and former journalist. The plan, when finalized, will require a significant level of resource. For once not necessarily monetary resource, but human resource of key staff and officers.
The issue though is far too important for us not to make it a priority. Our efforts over the last year have already seen the biggest improvement in broadband terms for consumers and ISPs in the last few years. However there is still a long way to go to achieve the level of competition that will deliver “true” broadband at affordable prices and no data caps.
David
Farrar
Chair, Public Policy
