Vodafone has 'private plan'

Fairfax Media

BEHIND THE SCENES: Vodafone is making a behind-the-scenes push to persuade the Government to establish a national consortium that would own telecommunications infrastructure, says a source close to negotiations.

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Vodafone is making a behind-the-scenes push to persuade the Government to establish a national consortium that would own telecommunications infrastructure, says a source close to negotiations.

It is understood Vodafone chose not to detail its proposal in its public submission to the Economic Development Ministry on the Government's $1.5 billion ultrafast broadband plan, opting instead to lobby Communications Minister Steven Joyce in private.

Vodafone's proposal would see Chorus and TelstraClear put their network assets into a new business that would be jointly owned by the three telcos and the Crown.

The Government and Vodafone would contribute cash in return for their equity stake, the source says.

''Vodafone was looking to give an undertaking to the Government that this group would deliver fibre to the home within 10 years.

''There would have to be some pre-agreement with the Government on pricing, and everyone would purchase services on an equal basis.''

Vodafone's British parent company is believed to have approached the European Commission about a similar arrangement.

It is understood Vodafone would face a challenge getting buy-in from Telecom and TelstraClear.

The source says there are also doubts about the cash that would be required. Vodafone said in a public submission that the ''fragmented regional concept'' behind the Government's broadband plan posed significant issues for any investor and hinted at an alternative.

It said ''a partnership between the Government and the key industry players could be a lower-risk plan for success''.

Labour Party communications spokeswoman Clare Curran says the National Party should admit that it will break its election promise to deliver ultrafast broadband to 75 per cent of homes, noting that a report commissioned by Treasury said that would cost between $5.3b and $10.4b, using the Government's preferred technology.

Much of the cost would be in connecting homes to fibre laid to streets, said the report, written by consultant Murray Milner.

Mr Joyce says the report was written for Treasury and not by it, but he appeared to hint the fibre rollout might stop at the pavement, saying in parliament the goal was ultrafast broadband ''availability'' to three-quarters of homes.

He told NZ InfoTech the Government had always said the Crown's $1.5b investment would need to be ''at least'' matched by the private sector.

''We do not see any problems in that regard.

''With regard to what consumers might pay, it's really too soon to say but of course there will be some kind of fee - in the same way there is now.

''Nobody is suggesting that our policy is fibre-to-the-home completely free of charge.