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Entepreneur Rod Drury’s government-run broadband infrastructure proposal sparks debate
Rod Drury is a successful entrepreneur. He sold his company, Aftermail, to Quest last year, and has recently launched a new startup called "Xero" providing small-to-medium businesses with a web-based financial management solution.
Drury's passionate about internet's role in providing New Zealand companies with an infrastructure that allows them to compete and flourish on the world stage. He recently published an open discussion paper, entitled "Securing our Digital Trade Routes", which calls on the Goverment to get hands-on in ensuring New Zealanders have access to a quality broadband infrastructure.
His proposal calls for the goverment to establish and administer a state-owned national fibre-optic backbone, with additional sub-oceanic fibre-optic links. He suggests that this new infrastructure should be managed by an SOE, and provide services to commercial telecommunications providers on a cost-plus-markup basis.
Drury's proposal has prompted comments from both Communications Minister, David Cunliffe, and Prime Minister, Helen Clark. Cunliffe has reportedly stated that the Government will give the proposal due consideration, but also suggested that government investment in infrastructure would be "inappropriate" in the short-term as it might limit commercial investment.
The proposal has stimulated debate in mainstream media as well. Drury has been interviewed by The Independent, NZ Herald and TVNZ amongst others. Mark Thomas, CEO of successful kiwi technology company Right Hemisphere, has also added his voice to the call for a government owned and operated infrastructure according to M-Net and gone one further in calling for the government to regain control of the copper network too.
Computerworld reports that a recent Wireless Data Forum meeting in Wellington saw opinion divided about the merits of the proposal. According to Computerworld there were two schools of thought; the "build-it-and-they-will-come" school, and those that think there's not yet sufficient demand for such a high-bandwidth network.
There's no denying that ubiquitous access to inexpensive, high-speed bandwidth is an economic enabler - research carried out by IDC Research on behalf of the Higrowth Project last year clearly demonstrated the impact that broadband penetration can have on economic activity.
The debate is whether broadband access should be afforded the same importance as "utilities" such as power or water and be managed as a state-owned asset, or whether a competitive free-market approach will be ensure the establishment of a solid communications infrastructure.
Free-market proponents will swear the latter option is preferable. They'll argue that the lack of existing competition has been the reason for New Zealand's lagging broadband adoption and that the Government's recent regulatory action will resolve this. Time will tell - but the critical question is how much time can we afford to allow?
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