Broadband talks to take more time

Telecom shareholders might have to wait months to find out whether the company will be involved in building the Government's Ultra-Fast Broadband network.

Government investment vehicle Crown Fibre Holdings was scheduled to make recommendations on preferred investment partners to ministers in October.

But Communications Minister Steven Joyce said that while he expected the first UFB contracts to be concluded next month, negotiations might not get under way with bidders in all regions covered by the scheme by then.

"There has never been an expectation it is all completed by the end of October."

Crown Fibre announced on Thursday that it would enter into negotiations with electricity lines companies to roll out fibre-optic cable in eight of the 33 cities included in the scheme. Chairman Simon Allen said elsewhere "all bidders had more work to do".

It is unclear when a further announcement will be forthcoming. A spokesman for Crown Fibre said it "may elect to commence negotiations with additional shortlisted parties at its discretion in coming weeks".

Mr Joyce said he had no deadline for the commencement of negotiations in all areas. Crown Fibre had to make the call who to negotiate with and when "as long as we are making good progress by the end of the year in terms of getting stuff started".

Telecom's silence on its future participation in the $1.35 billion tender appeared to weigh on the Government.

Mr Allen did not believe Thursday's announcement would cause Telecom to pull out of the UFB tender or can its proposed structural separation, however this has still not been confirmed by Telecom which yesterday maintained its silence.

Mr Joyce said those were issues for Telecom to decide.

Crown Fibre was negotiating with lines companies over 18 per cent of the coverage area, he said. "Yes, it's Hamilton and Tauranga and some big provincial centres, but it is not Auckland, Wellington and Christchurch, so I think everybody should give Crown Fibre the opportunity to proceed through its process."

- © Fairfax NZ News