KEY POINTS:
National nationalises the network. Crazy as it sounds, this could be the outcome of the party's proposed $1.5 billion, six-year investment in a new fibre-to-the-home network for New Zealand.
Details of the plan remain sketchy, but we do know it will involve some form of public/private partnership to make up the shortfall of the $3 billion-plus needed to realise this bold vision for 75 per cent of New Zealand homes.
I was shocked when National announced its grand plan. For the first time in 18 years of disastrous telecommunications policy, here was a political party finally stepping up to put right a great wrong.
More astonishingly, it was National, not Labour, putting forward serious money to repair a public utility squandered through privatisation. I thought I had entered a parallel universe where the left and right ideologies had become reversed.
But a dead fish we may all have to swallow is that Telecom will be the significant partner to complete National's broadband vision. Why? Because it makes more sense to re-use the existing Telecom infrastructure, rather than duplicating it for new fibre. Because it's more efficient to tie in with Telecom's belated fibre-to-the-node investment than replicate it. Because rolling out new fibre in conjunction with the old copper wire network would make the transition to broadband a faster and seamless process. Because two fixed networks for a country this size is not just wasteful, it's stupid.
Should it become the next government, the trick for National will be to parlay what Telecom brings to the negotiation table into something that delivers a true open access network on which any number of telco competitors can ply their trade.
An ideal outcome would be Telecom's now separated Chorus network back in government control and under the guidance of State Owned Enterprise Kordia, which has the telecommunications and broadcast experience needed to deliver converged public utility services.
But don't hold your breath. Public/private partnerships are difficult balancing acts, having to provide utility for the public while delivering good returns. Call me cynical, but I doubt National is capable of finding the right balance - especially given its early 90s "light handed" regulation regime which gave Telecom free rein to reap monopoly profits, underinvest and cause us to lag so far behind in the broadband world.
Then again, Labour hasn't done much better - taking three terms to turn the clock back on sloppy anti-competitive regulations and forcing Telecom to play ball. But having finally got reasonable regulation in place, Labour has shown a lack of nerve, failing to stump up with the necessary investment.
Many will balk at National providing a handout for Telecom to continue making huge profits for its investors. But others will see the public/private partnership mechanism - with a smattering of other equity partners besides Telecom out for a slice of the cake - as a pragmatic solution to quickly advancing our woeful broadband infrastructure.
The question remains, however, whether National has the smarts to make such a partnership deliver what the public needs. Or whether investor greed will once again hold sway. Eighteen years of telecommunications reform - where the monopoly has consistently out-manoeuvered government control - show us that history is on Telecom's side.
