Body Blow to New Zealand: Pacific Fibre Dead
August 2nd, 2012
I honestly thought we were seeing the light at the end of the tunnel.
It turned out to be the train.
Telecom wins again, the rest of New Zealand loses.
Via: interest.co.nz:
A Kiwi project to lay another undersea internet cable between New Zealand, Australia and the United States was scuppered by American concerns about Chinese investment in the venture and fears that might allow for Chinese espionage.
Pacific Fibre director Rod Drury told interest.co.nz it was made “very clear” by American authorities they would not permit significant Chinese investment in the US$400 million 13,000 km fibre-optic cable linking Auckland, Sydney and Los Angeles.
The next logical step after allowing a Chinese stake in the venture was demands for the use of Chinese equipment and technology in the cable, which would not have been allowed by the US government.
The project had been on track “several times” but ultimately fell through. Pacific Fibre had been caught in the middle of “real political issues” between the US and China, Drury said.
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Shock at Cancelled $400m Cable Plan
Via: New Zealand Herald:
Pacific Fibre’s cancellation of plans for the country’s second international fibre cable has been labelled “devastating news” for internet competition.
Pacific Fibre hoped to build a 12,950km fibre cable between Auckland, Sydney and Los Angeles at an estimated cost of $400 million but announced yesterday it had failed to raise enough capital for the project.
…
Pacific Fibre hoped to rival the Southern Cross Cable Network’s pipe, which is the only link transporting internet traffic in and out of New Zealand.
The second cable would have brought competition to the market and the price of international internet capacity down, Pacific Fibre argued.
This, it said, would allow internet companies to increase the monthly data caps they offer, so users could take advantage of the faster speeds of the Government’s $1.5 billion ultra-fast broadband network.
The UFB scheme aims to provide download speeds of 100 megabits per second to 75 per cent of New Zealand by the end of 2019.
Drury, Pacific Fibre’s co-founder, said the cost of New Zealand broadband made it hard to connect globally and it was “this market failure” the company had been looking to address.
“We still cannot see how the Government’s investment in UFB makes sense until the price of international bandwidth is greatly reduced,” Drury said.
Research Credit: harflimon
