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The New Zealand Institute Welcomes The Government's Broadband Investment Proposal

Fuseworks Media
Fuseworks Media

31 March 2009 - The New Zealand Institute welcomes today's announcement of ultra-fast broadband access for 75% of the population within ten years. "It is extremely positive that the Government has moved so quickly to honour its pre-election pledge to make broadband investment a priority", said Benedikte Jensen, Research Director at the New Zealand Institute. "The New Zealand Institute is confident that the proposed $1.5 billion government investment will be matched by at least an equal amount of private sector investment to transform access to broadband services for New Zealanders."

In April 2008 the New Zealand Institute released a proposal for a bold new approach to government investment in broadband. Today's announcement shows that the New Zealand Institute broadband vision is about to be realised. Delivering against this aspiration will allow New Zealand to capture significant economic value. The Institute has previously estimated that a high-speed broadband network would generate additional economic value of $2.7-$4.4 billion each year, with further gains possible through enabling innovation.

The proposed investment in broadband is a crucial step to propel New Zealand onto a higher growth and productivity path coming out of the recession. Given the rapid pace at which other countries are moving to deploy high-speed fibre-based networks, we applaud the Government's decision to act with urgency to invest in fibre.

The Government's proposal is consistent with New Zealand Institute advice to create a single investor in a national fibre network. The New Zealand Institute had recommended the creation of Fibre Co (a company part owned by the Government and part-owned by private sector investor partners) that would own the passive infrastructure and would grant equal and open access to the fibre access network to service providers. Today the Government announced the creation of a Crown-owned investment company ("Crown Fibre Investment Co") to manage the Government's investment in the public/private partnership structure.

The quantum of funding and proposed time frame (within ten years) for completing the pledge to deliver fibre to 75% of the population, matches the New Zealand Institute recommended level of investment and timing to deliver the desired economic returns for New Zealand.

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