Council must be in to win on fibre plan

OPINION: Whether or not the Government's $1.5 billion investment in ultrafast broadband works or proves value for money, it is the only major economic development initiative under way and one of the few areas of new government spending.

It should perhaps be of some concern, therefore, that Wellington City Council does not intend to invest in a local fibre company set up as a result of the scheme or to help co-ordinate the involvement of private sector investors – even if that might mean $145 million of investment on offer to the capital goes begging.

Broadband programme manager Paul Desborough says the council will largely limit its role to contributing assets such as land and ducting and to "streamlining" planning regulations.

That could reduce the construction costs of any fibre network built as a result of the scheme, a contribution that he says should not be underestimated.

The council is considering whether changes might be needed to rules governing both aerial and underground cabling.

Parties wishing to form a local fibre company and access the Government investment have until Friday to put their hand up to participate. They must lodge a proposal by January 29.

While the Government has signalled there will be an opportunity to participate in future rounds if partners do not step forward in any of the individual regions, the risk remains that the Government's contribution will not prove sufficient to kickstart the fibre rollout in all 33 regions and that laggards will permanently miss out.

Mr Desborough would not comment on the likelihood of a credible bid emerging from Wellington. "We are not in a position where we are going to get involved in that.

"The Government has proceeded with this plan, so they must have some expectation that there are companies out there that would be prepared to put something together."

He insists the council is not indifferent to the success of the scheme, though. "We think broadband is important and we want faster broadband in Wellington. It is important to our economy and knowledge-intensive industries and we want to remain competitive. But "there is not a lot of scope, financially, for councils to get into new activities".

It is an understandable position. Councils have been led down the garden path on broadband before, and ministers are still sending them mixed messages, promoting the possible involvement of local authorities in the broadband scheme while also saying local government should focus on "core" activities.

Wellington's participation is hugely complicated by TelstraClear's nearly-good-enough InHome cable network and its unhelpful topography.

TelstraClear chief executive Allan Freeth's deep scepticism concerning the fibre proposal may be weighing on the minds of local politicians as they gear up for council elections.

The council does not have a great deal of capital or relevant expertise to contribute. But it could provide a vision and help pull together competing commercial interests.

It may need to articulate to the Government why it is vital the capital gets its share of the investment, even if that means considering a bid that is perhaps a little different to those in other regions with regard to the technologies proposed and the focus on infrastructure rather than services.

The public service, the ICT industry and the "creative" sector are the triple pillars of the Wellington economy, but it is still leaning a little heavily on the former given the "decade of deficits" facing the public service and the squeeze being put on departments by Finance Minister Bill English.

It is in the interests of the Government, taxpayers everywhere and the city, that it shifts its weight if it can.

The fibre scheme could help. The first, tough step should be for the council to shoulder its civic duty and accept some responsibility for the outcome that will be achieved in Wellington – the rest can follow.

- © Fairfax NZ News