Your views: Telecom ordered to open up lines

What people think about what will happen now Parliament has passed legislation forcing Telecom to open its copper wires to competitors.

Communications Minister David Cunliffe said it was a landmark bill that would bring faster and better broadband to New Zealanders.

What do you think? Will the passing of the Telecom bill make any real difference?

>> Read the story

A selection of your views appear below:

Stephen Taylor

The NZ government sold the local access in its entirety to the entity thats now Telecom NZ Ltd. Fair enough to open up the local loop to competition however as it cost the entity hundreds of millions to buy off the Government then the Government needs to pay Telecom a fair and equitable amount of money for opening up the local loop. If the NZ goverment hasn't or won't pay a fair fee then this is a form of nationalisation as its forcing one business to share its assets with competitors without compensation. The Govermnet is gambling that Telecom will keep investing in local loop infrastructure to roll out its own services, however knowing what I know Telecom will now spend its energy on new technologies that bypass the local loop and don't have to be shared. It will do so quietly and purposefully, upgrades will only take place far more specifically. Anyone that expects farmers to have miraculously improved access or faster broadband speeds by Telecom and its competitors is sadly mistaken. Telecom will spend less on local access than ever before. The simply example is why buy a porsche if you know that everyone in your street is allowed to drive it? The Government maybe able to legislate Telecom to share local access within a limited specification but it cannot legislate Telecom to spend money on IP infrastructure upgrades. To do so would be contrary to the rules of commerce and the free market, resulting in more than just a couple of billion wiped off the stock exchange. Trying to force Telecom to invest in local loop access would see mass flight of investment and capital out of the economy and NZ plunged into a currency crisis unseen since the Muldoon era with mass unemployment as it would be viewed as a socialist dictatorship.

Zpete

Haaaaaaaaaaaah, I do not see VODAPHONE, IHUG, TELSTRA etc, being told to let TELECOM use some of their resources. Not fair in my opinion, if you own sumthing, it is yours to do as you wish. Not being a fan of TELECOM, I do believe, "What is yours, is yours to do as you wish". Imagine if the same thing was done with many of NZ's largest companies, told to share their property. The government would get short shift. NOT FAIR.

Rod.K

With Telecom having to split into three operational units, a good portion of the leglislation will be nullified. Telecom has been told it is not to sell it's ISP services to it's own wholesale arm at a lesser cost than to competing companies. So? Telecom still controls the market. If we watch carefully, we will see Telecom selling it's ISP access at literally whatever it sees fit to it's wholesale arm. The market competitivity is set by what ISP's can or can not do for their customers. All Telecom needs to do, is add a healthy additional percentage to the actual base cost, when supplying their own wholesale arm, which then becomes the benchmark for the other ISP companies. Telecom don't even have to flinch when doing this, as the market pricing can only be as good as the other ISP providers can make it, within whatever ends up being the base benchmark. Telecom can sell to their wholesale operation with generous profit embedded, knowing full well that the competitors are limited in the benefits they can offer the market overlall. In that way Telecom can maintain a higher than necessary base cost for Internet services, with all the other players tied into the limitations which result. The line access wholesale rate needs to be set by somebody other than Telecom, or it's all been a great big legislative waste of time.

D

ennis Sosnoski

Telecom has shown they have no concern whatsoever over keeping New Zealand in the Internet Dark Ages, so long as they can maintain their monopoly profits. Lately they've even resorted to deceptive advertising - and worse - for their so-called "Go Large" plan. Because of this I'm now looking for another Internet provider. I personally don't think the government has gone nearly far enough in their "operational separation" plan - Telecom should be split into separate competing companies, and the current crop of executives should be thoroughly investigated for deliberate violations of the law - but at least this is a start. Eventually New Zealand may even make it into the 21st Century with the rest of the OECD countries.

Tony Chaudhary

What surprises me, or makes me laugh,.. sadly, is the slow pace of reform in our country. The administration might be able to gauge from people's overwhelming positive response to the Telecom's opening it's lines, that they need to be proactive and not reactive. About time, for a lot of other issues too.

Daibach

Indeed it's about time, but let's not forget that the legislation was almost unanimous, so it was Parliament that passed it, not just Labour.

Ray

Good on the government for trying to sort the Telecom monopoly. But, Hang on, Wasn't the government the ones that sold this ex state owned enterprise in the first place? Personaly I think this government and several ones before need to re-think their SELLOUT mentality and purchase all the ex state owned enterprises back, in particular the railways. What a stupid waste of time making silly little laws to cover their failings.

Rod Mills

I live in a rural area an if it means that I get a chance to actually recieve broadband, then go the Government!

Mason Gillies

It's about time that the telecommunications legislation in this country was brought up to scratch. We can only hope that telecom or the government will upgrade the terribly outdated network backbone to enable our quality of broadband to improve. With that said however the most concerning part of this article to myself was that regarding the postition of the Maori party. I would be interested to see how they justify saying that maori were entitled to a portion of the telecommunications industry under the treaty of waitangi, I was unawear that New Zealand had a developed telephone and internet network in 1840, nor that maori ahd any influence in the development of such a network. If maori want a part of the telecommunication sector why dont they set up their own company or network, instead of trying to claim things that other people have developed. It is these sort of comments that are driving this country apart.

Jason

I do "not" believe this will have a big effect at all. I think its a big smoke screen behind closed doors for new zealand "yet again". All that will happen now is for other companies such as ihug, teltra clear and others to simply have the say over their customers and simply rip us off as telecon has done for ages past. The competition will not be there and it will not create a fair play act at all. Ihug are already slowing down the lines as well as telecon etc. FTP downloading and person to person sharing networks and streaming video etc that are common place now have been cut down to a quarter of its normal speed etc. Ihug state high speed internet, telecon do to, yet we, the people who buy their products "do not" get the speed we are paying for. This is a big rip off, yet its the net, and we have to be linked up to one of these outfits to have the net running. "SO WHAT"! When will the government follow the obvious comments of telecon in that they are "not" being straight with us and also realise that others are also being secretive, and dishonest about what is taking place. We pay good money, "way to much", for very slow internet. I havent personally met "anyone at all" who gets 7.4 or so MB which is stated by the ISPs. Whats going on? Telecon say as fast as your line can handle it - yeah right! When will the government for once step in and do something honest for the people. We all use the net. We all do! Its a way to have a business, a way to grow so many companies in new zealand from inovation that are impossible when these companies rip us off and have such a slow service and slow internet. I havent met anyone at all who isnt "totally fed up" with the internet service - everyone has had enough. This unbundling will not do anything at all other than bring into the "we are not being straight with you senario. If you buy a blue car, and its going to be delivered to your house later in the week, and when its dropped off, it is yellow - are we supposed to say nothing, or just accept it and grumble for months? Have we the people have supposed to have any rights at all? When will we actually get what we are paying for? The government havent stated that in this report. Think about it. Around $60.00 a month for very very slow internet and extremely poor service. What the hell is that all about? More competition doesnt create better deals, it never does, it simply creates more confusion and different ways to rip people off. Bring back the post office and true flat rate plans. The way they feel they do us a good service is by speeding up the net, which doesnt take place, then at the same time they put extreme caps on the net. Why has there nothing beemn said about the caps. When are they getting removed? Theres so much in this bill thats is extremely flawed. Its not transparent, thats for sure.

Matt

So hands up those people that think a company should not make a return on investment for the shareholders. Okay now all you left wing political people can put your hands down. What a crock Telecom was formed after the infrastructure was sold by the government thats right it was sold. So where is the compensation for now meddling with it?????????

Nigel Wade

It's mis-directed legislation. Broadband is not fast enough to support the types of data transfer rates society will need in the long run. In 5-10 years 8mpbs will seem like dial up, it already does to me.

Exchanges are complex highly specialized bits of kit, cant just have any old person in there working on them, I see third party techs, from XYZ isp working on exchange wiring and taking out suburbs in the near future. (oh great, inexperienced ppl working on exchanges). Telecom's the winner here in the long run. Now we have third party ISP's able to offer end to end low level service (broadband), leaving Telecom free to focus on better and faster solutions for their own customers. Expect one level of service for a customer of XYZ isp, and another for telecom customers. Why ? ... I've seen telecom spend over $5000 just to get the line quality right for one customer, I do not think that will happen for a customer of XYZ (startup) ISP, in fact .. I'm 99 per cent sure it wont. So, good luck New Zealand. You missed the point yet again.

Hayley

This is a joke, Telecom are pretty good at what they do, how can a company like TelstraClear (let alone call plus or ihug) be expected to manage someones elses lines when they can barely manage their own network. I suspect this will end up in a big mess and the government via the NZ taxpayer will have to sort it out. Just because other countries have opened up the loup (some with lots of problems like Switzerland) doesn't mean we have to.

Sam Chen

I think Telecom is a very bad company, it is a very bad customers service, it is only got a landline company in NZ, the NZ gorvment should do this things erlier.

Bruce

I don't know why the government (and the country's citizens) don't simply put up a satellite and bypass the whole jolly lot.

Blair

Telecom NZ had the opportunity to 'play fair' and fling open the doors to it's exchanges in 2000 when British Telecom was forced to do the same."Telecom NZ chose not too".In 2003 Easynet became the first independent ISP in the U.K to install ADSL equipment at Dimsdale,in the West Midlands.British Telecom,at the time,was accused of deliberately obstructing the process in order to maintain its dominance of the wholesale ADSL market -- a charge it has repeatedly denied. What I'd like to know is, will Telecom NZ do a turtle imitation of BT,now that they have a new British manager of Telecom NZ wholesale?. Kiwi's are sick to death of the "She'll be right" attitude of this Telecommunications institution.

Colin Morley

I wonder after all this has been done and all the ISP's will end up like the petrol prices and all have the same prices and no competition.

Jason

1. What about all the other companies that own lines ? This ruling should be accross the board and not just for Telecom NZ

2. We keep getting compared with other countries such as the UK, but note for for almost the same land area the UK has 60 million people vs our 4 million - economies of scale would dictate the quality of service

3. Alot of the problems in the main cities are due to backfilling of older suburbs where the lines were laid pre TNZ becoming a private entity, in the days where 1/4 acre sections were the norm and no sane compnay would invest in 3 - 4 times the infrastructure that was required expecting the sections to become high density housing.

4. To recify point 3 required digging up roads etc to relay more cable. a. that costs $$ and b. there is all the red tape to go through. So 1+1 and 0+1 lines were put in place (pre internet days) making modems (let alone broadband) near impossible.

All up I think this legislation is going about things the wrong way and does not encourage industry investment.

Len

Telecom have still managed to nobble the bill. The NZ consumer still aren't going to see much benefit from this and Telecom will still make record profits to be sent to their overseas shareholders.

Norbet

Welcome to the 20th Century, hopefully we will get very soon unlimited traffic with affordable prices like in Europe ! I already shifted from Telecom XTRA Broadband to XNet.Co.nz Jetstream (Broadband). Telecom wasn't quite helpful and deactivated twice all my phone settings. It was ennoying ...

Karrie

So nice to have access to unlimited faster cheaper BB - but - what about the other side ? How would you feel if you ran a business and had invested over many years in stock and plant , and someone said you then had to share it with everyone else ? And how willing would you be to invest even more in the future , if those assets also had to be shared ? How willing will Telecom be now to invest heavily the billions needed to upgrade the Southern X cable , instal fibre optic cables and all the new cabinets needed to support the new and existing BB users. Everyone is screaming for better cheaper ( free if possible ) faster - where's the point at which people are happy ? Free ? Supersonic speeds ? Unlimited plans for all ? Choice of 100 telcos fighting for market share ? ADSL 2,3,4 ? Not that I asm against all these things, but the responses so far amaze me with their one-sided views . This change will not miraculously immediately transform unprofitable companies into profitable ones

Karen

Too little too late. We can never recover the cost to business of the greedy unprincipled handbrake that our politicians have allowed in the form of telecom nz. We have been immeasurably handicapped. 30 years ago i was offended by an immigrating scotsman's appraisal of nz: "welcome to Disneyland". Today i still pay huge fees to play in Telecom's park - and still come away with a gut ache.

Colin

About time this fat lazy monopoly got a dose of the real world. Hopefully, this development would enable true competition and better services.

Bert

Great, now huge multinationals like Vodafone can set up and take Kiwi money offshore.

Geoff Maxwell

This whole sorry saga is outrageous. Government interference in the business of a private company merely carries us further down the path to a banana republic.

John Rogers

The gullible public will be sucked in again. We saw what happened when our power was fragmented and everyone and his dog took a chunk and inflated our power bills. Do you really think anything has changed in this world. Ask the big boys with their shares in communications? For once Labour is doing no service.

John Lewis

Maybe the next step is to bring some commercial realism into the unrealistic rewards the unbridled executives and directors vote themselves based on their ntouchable position in the totally protected and commercially unrealistic environment they have existed in over the last 5 or so years. Telecom as a company is not a viable operation they have existed in a totally protected environment insulated from competition and all funded by the tax payer. Get real or get out, I helped pay for the system now I believe I would like to get something back for my investment as a tax payer by way of competitive pricing & service, lets see how Telecom like N.Z. manufacturing of 20 years ago can survive in the real world.

J.C.N

At the the first opportunity I got Telecom out of my house. Passing a bill is one thing, how long before it is implemented?

KP

About bloody time. Hard working NZers owned the network and it should have never been sold. I don't care if my shares that I bought to keep it NZ controlled plummet but I am sick and tired of people making megabucks on a pigs back that was built in very trying conditions throughout NZ on the basis everyone is equal over (from a remote farmer to the city slicker)a number of years to get everyone a telephone in their home (which later developed to internet access and the world at your fingertips). With top managers and the CEO get ridiculous salaries for something that will naturally generate income because of the type of product it is it is about time some sanity was bought and quality of service improved - that's where the $$$ should be spent - it shoudl NOT be a profit making venture but break even with some put aside for improvements.

Mark J

That is all great and wonderful, but does this mean I will one day be able to drive my Ferrari further than the dairy?

Andrew

I think it's the most disgusting think a government could do; it's called fascism when government forces a privately owned business to do something against its will. The fact that people applaud this is equally appalling; they say they don't like a monopoly; then define government if it isn't a monopoly?

Peter McBride

Finally NZ small businesses may begin to close the gap for online website advertising quality when compared to almost all other countries the draconian stiffling of bandwidth and exorbinant charging regime by Telecom has come to a long overdue end! Until now NZ telecom was a closely matched with parallel phone company MATAV ( Hungary) which had the same myopic miserly disregard for new investment whilst squeezing the very last breath in fees and charges from the haplass consumer.

May Telecom's outgoing management rot in hell for the damage inflicted upon NZ businesses.

Matt

The Government, or the public of NZ used to own the, then, NZ Post Office. It was turned into a State Owned Enterprise, required to fend for itself, and then fully privatised, yet the new owners have no control over it. What a ripoff for shareholders, and the public of NZ. If government want to continue to treat Telecom like a public utility, how can they justify privatising it in the first place? The true villain of this story is the government, not Telecom. The Government is now only a minority shareholder in Telecom, yet it apparently can still do what it likes to the detriment of the company. What kind of message does that send to shareholders?

Lastly, if new operators wish to take a bite out of the NZ telecomm's pie, they should be required to grow and maintain their fair share of the local access network.

John McCulloch

I have had a recent experience with an opposition telecommunication firm which left me with a very bad view of what is offering or appears to be offering. I find the decision by the government ill advised & short sighted without apparently due diligence to detail.

Richard James

Great move. The lesson to be learnt from it, is do not be a successful company in NZ, or else the government will screw you over for it.

Don Burte

I am concerned that the politics have got in the way of the beehive as when NZPO/Telecom was sold they lost effective "control" and after 100 years of being able to "direct" the NZPO management to implement or NOT implement was a great LOSS. All legislation should be fair and even to all players and not just against one player. To claim that the exchanges are "clapped out" and lack of investment is an unfair comment as the existing exchanges and supplier were a political decision years ago by a PM General (minister in charge of the Post Office) who commented that they "looked Pretty", even though it was not the engineering recommendations at the time, something the new players have not had to deal with, this I guess would be easly forgotten. Yes things will improve all round but I can't see it happening at the speed some correspondents suggest. My question is "should I invest in Telecom?, or is it also to be nationalised as has Air NZ?.

Chandar Rajaraman

It is a welcome move and will bring faster and cheaper broadband to every home.

Tony Kane

Its about bloody time someone got through to these damned Telecom moneymakers....the problem being though most of the money goes out of NZ. Telecom has always been overexuberant with their charges and think they own the country. Thank God someone in politics in NZ hasnt got just unwanted wind in Wellington. Let the hammer fall!

R.Mayall

The confiscation of Telecom assets by the NZ socialist government may be only the start. What next; the taking of land without compensation for government projects? Ports of Auckland may have been lucky that they did not lose their land without compensation for a sports stadium. Of course most New Zealanders are happy with the government's Telecom decision. They may get cheaper faster broadband at Telecom shareholders' expense. A nation of dishonest bludgers is what we have become.

Pat Deady

Telecom should concentrate on its core business which should be behaving as a Carrier. At the moment it's fighting for its very survival, its Wholesale division in fierce competition with its very own Retail arm, one taking business from the other and paying a fee to the various private firms working as agents for them. The situation is ludicrous and in my opinion and experience is effecting the way their staff operate. They demand and get blind loyalty typical of such a corporate. Get out of Ferrit and Xtra and go back to the basic business..Carrier, or face takeover.

Bernard Grice

The legislation misses the mark in two areas - the two bottlenecks are the inter-connect agreements (new networks connecting with Telecom with symmmetrical contracts) and the southern cross cable, which Telecom controls. Interconnect agreements should be controlled so that Telecom cannot charge more for calls terminated on its network than calls terminated on other networks and the un-utilised capacity in the southern cross cable should be nationalised (about 90 per cent at the current time) and then tendered on the basis that no single entity is able to control more than 5 per cent of the fibres in the southern cross cable. Do this and watch competition flourish and watch NZ grow - the current reforms are a waste of time because they assume that Telecom's network is the alpha and omega and the reforms do not encourage new network investment.

Bryan Flanagan

Firstly, it's a travesty of justice. Like it or not, Telecom paid the going rate for the local loop along with the rest of the telephone infrastructure. The asset is theirs, just the same as my house is mine. Should I have to share my lounge with anybody who cares to knock on my door ? Secondly, by legislating access for all to the local loop, the Government are removing much of the incentive to the development of alternate and potentially superior technologies. Note that Wave no longer do wireless, IHUG no longer do satellite and Woosh are beginning to do ADSL ? And how long since Telstra laid new fibre ? Why bother when you can simply poach a bit of Telecom's antiquated, poorly maintained infrastructure and thereby save capital investment ? Short term gain from poorly considered legislation will surely become an overall loss to the consumer. The only thing I find more scary than Telecom controlling my IP packets is the Government doing so. People, including myself, love to hack at Telecom's competence and business practice, but they are streets ahead of the Government in these respects.

Mike

Initially it will be a good thing for the NZ consumer, Broadband will be opened up to everyone, and cheap packages like the ones found in the UK, (where BT has been forced to unbundle a few years back), will start appearing. But then the rot will set in, every company will be focusing on the profits made from the consumer & business sectors, they will be slashing their margins and leaving nothing for investment in infrastructure, soon New Zealand will have cheap 2Meg broadband in every home but the rest of the world will be running on Gigabit connections, and New Zealand will again be in a a backwards position. Then the government will again step in and force private investors to either pay towards new infrastructure or quit the market, finally in about 30 years time the government will be forced to buy the entire market and make it a publicly owned enterprise, pouring billions and billions into infrastructure to catch NZ up to the rest of the world. After a about 10 years of that the governemt will get sick of owning a losing business so they will sell it to a global company for a few dollars with the promise that they will invest the difference in infrastructure ... and so the cycle will begin again.

Peter (Henderson)

What a nation of small petty minded people we are!

Allof the emails seem to be happy that a big company is going to be made small so that we might save a few dollars. How pathetic! The real crime is that our controlling socialist government has, by force, interferred in the affairs of a public company and stolen the assetts of its shareholders.Some idiots in our Nation seem to be happy to let this evil government woo us with bribes to remain in power then date rape us for the following three years! God defend New Zealand.(Labour isn't).

Murray Hawkes

Telecom have bought this on themselves by delivering sub standard services and third world maintenance standards for years, competition is welcomed. However--- the bigger picture is once again NZ government have sent a firm message to international investors, WE CAN'T BE TRUSTED TO KEEP A CONTRACT.NZ governments, and this one in particular have been prone to retrospective legislation and legislation which destroys or assumes property rights without compensation. Expect future investors in NZ, including Kiwis chosing to keep their money at home (ie not the rich ones) to demand a higher rate of return as NZ has a very high Soverign risk because govenments don't abide by agreements.

Alex Wales

Its about time we busted this Telecom monopoly. I as I know others are very frustrated with the third world standard service from this company. Whats more their charges are amoungst the most expensive in the world. Three cheers for a polititian that actually got it right.

Marcello

I dont think it would make any difference as loong as Telecom own the infrastructure.As long as Telecom holds the reigns of the cost to provide basic connectivity to homes the end user is not going to benefit and competitors will have to cut their margins or provide a marginal service.

Fran

Brilliant! How is this country supposed to progress and continue to grow without such a significant change? The age of converged technology is upon us and it's about time for the frame work to be adequate (up to international standards) for future technology to take place.

Dennis Keith

Great if it helps to lower costs and improve access, especially in rural areas. However "all you can eat" broadband (Minister's rhetoric) is nonsense. Telecom cannot deliver high speed broadband now and that will only be rectified when almost obsolete equipment, clapped out exchanges and dodgy lines are replaced. The length of the TC cable from my home to the exchange is 2.5 km. I subscribe to a 2GB download plan, yet most of the time I do not achieve 1GB - between 600MB and 800MB is typical.

Doug

I certainly hope this does make a difference, NZ is not a very good place to use the internet, we are strangled here by a monopoly, it is sad that NZ has had to endure what it has. Now we just have to get the electricity companies to open their lines up.

Alan Emerson

Totally support the government. Telecom has been a leg-rope on the rural sector for years, promising much but delivering nothing. We inserted our own wireless network over a year ago and it has made the business far more efficient.

Wally Muzak

Lack of telephone exchanges in all suburbs has choked and created a serious shortage of local loop lines.

Telephone line new connection fees have gone up to $95.00 plus a visit from the faultman will cost $65.00 and additional line jacks,new telephone purchase and wiring would cost more also. Twelve months phone line billing rental now required as the bond. It can cost you over $1,000.00 to get a phone line connection in the main cities.

Constant line dismantling is going on inside telephone exchanges and roadside junction boxes etc. There has been no telephone line infrastructure regulations to force Telecom to leave intact phone lines alone,where current Telecom account customers hold a Telecom Billing/Line Contract for their properties.

Lines must be always be available when the customer has paid for the exchange connection time and time again.

Customer should not have to pay new connection fees every month for the same lines and phone numbers.

I paid for four new line hookups but only now use two.

The other two lines have been dismantled again.

Lines need to be on standby/hold/holiday/for new tennents or family and when sons and daughters return home etc. Now Telecom will have to invest heavily in roadside cabinets and deliver quality phone lines and faster broadband lines. Every home needs 1.5 Mbps uncaped speed per user minimum during peek loading sessions.

John Scott

To take action against Telecom and no other Companies in NZ can be shown to be detrimental to the business of all NZ Companies. Their value can and will be destroyed because of some Government whim. Other Companies have their own networks and may yet get really into the business of public networks. They all have to have authorisation to be network operators at present. Therefore they should be under the same obligations as Telecom, that is, to sell capacity on their networks at a rate determined by the Government.

The other aspect : do you castrate an elephant to see if it will be able to run faster ?

James Wigg

About time. Onwards and upwards. Here's to more capacity, better investment, no caps and better pricing.

Ian Printy

All i can say is about blooming time. Telecom has too much of a stranglehold on the phone/broaband monopoly in New Zealand and this new bill will create competition with all ISP's and give ordinary kiwis the chance to be up there with the rest of the planet.

Good to see action being taken at last.

David Lawton

This is indeed landmark legislation, and congratulations to Labour here in NZ that like all other OECD countries, they didn't buy into the idea of property rights being the final determinment of the level of required regulatory action.

This approach would have set NZ back a further decade in its infrastructural development compared with our aggressive competitors in Asia Pacific - but now NZ has the opportu