Pacific Fibre, the company that hoped to build New Zealand's second international internet link, will cease operations after failing to raise enough capital for the project.
Pacific Fibre hoped to build a 12,950km fibre cable between Auckland, Sydney and Los Angeles at an estimated cost of $400 million.
But it just announced that it has failed to raise enough money for the project and would cease operations.
"We've spent millions of shareholder funds trying to get this done and despite getting some good investor support we have not been able to find the level of investment required in New Zealand initially and more broadly offshore," said Pacific Fibre chairman Sam Morgan.
"We feel like we've done everything we can to succeed and we are all hugely disappointed that we have not managed to get there," he said.
Morgan also tweeted his disappointment at the company folding.
"Terribly disappointed we couldn't get Pacific Fibre away. Was always going to be tough but feel we gave it a bloody good try," he said.
The company had earlier failed to meet the deadlines it had told media it wanted to gather capital by.
Pacific Fibre hoped to rival the Southern Cross Cable Networks' pipe, which is the only link transporting internet traffic in and out of New Zealand. The second cable would bring competition to the market and bring the price of international internet capacity down, Pacific Fibre argued.
This, it argued, would allow internet companies to increase the monthly data caps they offer, so users can take advantage of the faster speeds of the Government's $1.35 billion ultra-fast broadband network.
The UFB scheme aims to provide download speeds of 100 megabits per second to 75 per cent of New Zealand by the end of 2019.
"We started Pacific Fibre because we know how important it is to connect New Zealanders to global markets. The high cost of broadband in New Zealand makes it hard to connect globally and it is this market failure, not a technical failure, that we tried hard to solve," said co-founder and director Rod Drury.
"We still cannot see how the government's investment in UFB makes sense until the price of international bandwidth is greatly reduced," Drury said.
Pacific Fibre had already secured some big anchor customers, including Vodafone who signed a 10-year contract with the company worth more than $100 million.
Company chief executive Mark Rushworth said earlier this year that pre-sale contracts (which should be considered revenue for the company) amounted to US$170 million.
The company had been backed by a number of high profile investors including Facebook billionaire Peter Thiel and Warehouse founder Sir Stephen Tindall.