National antes up with bold broadband plan

Ask the National Party what it plans to do in the area of telecommunications and broadband as I did of Bill English last May and you  usually don't get an answer of much substance.

That's changed today with John Key's announcement that a National Government would invest up to $1.5 billion towards building an open-access, FTTP (fibre to the premises) network in New Zealand.

In fact, it's the opposite of what English was saying less than a year ago.

"We'll have a good look at the [Australian Labor Party's] proposition but we're a bit concerned to see local bodies or central Government investing in these networks," said English, when I asked him whether National would consider a publicly-funded fibre network along the lines the Australian Government is working on.

"They need to be very careful that they're not crowding out private investment," added English.

A year has obviously changed a lot. The broadband debate has stepped up a notch and National's play here with a sizeable amount of funding shows how seriously it now considers broadband to improving our productivity and growing the economy.

"National's medium to long-term vision is for a fibre connection to almost every home, supported by satellite and mobile solutions where it makes sense," says Key.

In that respect, it is on the same page as the Government, however Labour has (yet) made no such undertaking to pour that level of public funding into a fibre network build. Key's five principles by which the network would be built are pragmatic but will also be problematic. In particular, building out fibre without hurting the business case of Telecom and the players who are diving into local loop unbundling will be challenging. Making sure the Government doesn't end up "lining the pockets of incumbent industry players" will be equally challenging.

Look at what's happening in Australia. I'm, currently in Melbourne at an IT conference and the people I'm talking to here are sceptical that the ambitious broadband network plan in store for Australia can be achieved as it was envisaged last year, before the election. The time line is already slipping.

National is signalling it's willing to make some bold moves in the broadband space. That leaves us in a position where we have an opposition party with the vision to bring about sweeping change but a current administration and communications minister probably more capable of carrying it out - if only because they've had so much experience in the telecommunications space in the last eight years.

What National needs to do now is back up the New Zealand Institute's figures on the productivity gains ($2.7 - $4.4 billion) that a nationwide fibre network would bring, with some world class research.

Where exactly will the gains come from? It increasingly looks like taxpayer dollars will be used to build a high-speed network initially linking businesses, then households. But we need to make sure we make good use of the new fat pipes from day one. Otherwise, what will have been the point?