Fonterra's wires crossed, critics claim

By ADAM GIFFORD

Promoters of rural broadband initiatives are angered by Fonterra's decision to make a Telecom-Broadcast Communications (BCL) consortium its preferred partner in its drive to get its farmer suppliers onto the internet.

The dairy giant yesterday kicked off a Whangarei-to-Gore roadshow to outline the FonterraNet concept to its suppliers.

Project manager Kris Nygren said the decision on whether to go ahead with the network depended on the response from suppliers.

But the proposed collaboration seems at odds with Fonterra's rhetoric about taking a whole-of-community approach to its activities in the rural sector, and with BCL's promises to offer wholesale access to its networks to all-comers, rather than in tandem with the only other national network provider.

Fonterra's justification, that it wants to deal with a national provider, is not seen to stack up technically, and the service offered, which includes internet telephony only to others on the virtual private network, also falls short of real life.

"A dairy farmer in the Wairarapa doesn't make calls to a dairy farmer in Southland," said Peter McNeur, who heads the Wairarapa community broadband initiative.

"He talks to his contractors or his staff.

"I am gobsmacked. I don't think this is necessarily in the interests of the farming community or the wider community,"

Northland broadband trust chairman Chris Mathews said Fonterra wanted to compete with or displace Project Probe, the Government's initiative aimed at getting all New Zealand schools onto broadband.

"There seems to be an alignment between Telecom, BCL, Fonterra and the Wellington corporate Federated Farmers people to argue the country is too small for more than one network," Mathews said.

BCL chief executive Geoff Lawson has denied his company favoured Telecom over other providers.

"It is in our interests to see multiple networks and multiple customers," Lawson said.

While Telecom was the only company BCL had a formal contract with, it was talking to a number of parties about its wireless access network, due to go live on October 1.

Lawson said the Airspan base stations and terminals had been ordered and would be installed on 28 sites when they arrived.

Other broadband promoters see the FonterraNet partnership as being about monopolistic bureaucracies that want to work with other monopolies.

They also question why Telecom wants to own rural broadband, 18 months after it seemed keen to ditch its rural telephone network, and whether the inducements it is offering Fonterra amount to anti-competitive behaviour.

Telecom spokesman John Goulter said Telecom had considered divesting its rural networks but "we made the decision we wanted to be in the rural network because our reach is one of our great strengths, so we need to be in boots and all".

"Since them we have made huge investments there, including the roll out of broadband, which can now reach 83 per cent of New Zealanders."

Sources say Telecom lobbyists made a beeline for the Beehive after the company was passed over by Southland in favour of a Walker Wireless-Vodafone solution, and this resulted in Wairarapa and Northland taking great care over their tenders.

Wairarapa gave its shortlist to two independent assessors, and expects their recommendations by the end of the week.

Northland adopted the same two assessor process for the same shortlist - the Telecom-BCL consortium, UCC Technologies and Walker Wireless with Vodafone.

"We have gone to a great deal of time and effort to make sure the process is bulletproof," McNeur said.

The Northland decision is also expected in the next few weeks.

Goulter denied Telecom spat the dummy over losing the Southland tender.

"We talk to politicians all the time about all sorts of things but we have not lobbied over Probe," he said. But he confirmed it had argued against Probe's regional thrust.

"In a small country, schools might be better served by having a national solution, but it is up to Probe to decide.

"There could be problems with interoperability and extras costs associated with having multiple regional players with different technologies.

"Schools need more than a fat pipe connected to the internet if they want to use it properly, if they want services delivered over it."

Federated Farmers president Tom Lambie said FonterraNet should not affect competing broadband efforts.

He said farmers would make their own technology decisions.