By PETER GRIFFIN*
SYDNEY - Australia's Communications Minister, Senator Richard Alston, has urged New Zealand to open competitor access to Telecom's nationwide copper network, citing the move as essential to breaking the telco's monopoly on line access.
Unbundling the "local loop" would give Telecom's arch rival TelstraClear access to the copper wires connecting most New Zealand homes to the national network.
TelstraClear would then be able to lease line access from Telecom, in effect offering the same local calling services as Telecom at a similar price.
Speaking at the CeBIT technology show in Sydney this week, Alston said sharing the lines of the incumbent was a fundamental requirement where competitors were struggling to mount a viable business case for building their own networks. "The US and Europe are still grappling with [local loop unbundling] but line sharing and unbundling are critical elements [to stimulating competition]," said Alston.
"The incumbent has the bulk of the network; the only way to stimulate competition is to provide access to that network."
Australian operator Telstra, 50 per cent owned by the Australian Government, was forced to unbundle and has gradually improved the wholesale pricing for competitors wishing to resell its telecoms and internet services.
Telecommunications commissioner Douglas Webb is considering local loop unbundling for New Zealand and has released a request for proposals to carry out a cost benefit analysis.
The commission's draft report on the issue is due at the end of July and final report to the minister on October 1.
Sars and the lingering aftermath of war in Iraq has taken its toll on CeBIT this year with just one company attending from China - down from 22 last year. New Zealand attendance too was dramatically down, from 25 companies last year to nine companies this year.
However, new research released at CeBIT this week gave encouraging signs that the IT and communications industry is showing signs of recovery.
The latest survey from the European Information Technology Observatory showed market growth in the industry for 2003 was expected to be 4.5 per cent, up from a low of 1.2 per cent last year.
The research showed the share of the global ICT sector owned by the US was shrinking, down 2.5 per cent to 31.5 per cent. That decrease came as investment was put into high growth areas, such as Asia, Eastern Europe and Latin America.
* Peter Griffin travelled to Sydney as a guest of Hannover Fairs Australia.
NZ urged to copy Australia and 'unbundle local loop'
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