Do you really think it's going to end up 0% private contribution? I'm sure you don't. The government is of course picking between the companies that have made bids - at least one of them I'm sure is going to commit to spending.
If I was a Telecom shareholder or a Vector shareholder then I would hope that its a 0% private contribution from the company I have a part-ownership in. Its not economic and I'd expect that the board and management would have a greater fiduciary duty than to destroy shareholder wealth by investing in an uneconomic project.
I'd much rather be a buyer of access from the Government or firm that does build it. If its open access and someone builds it with a subeconomic return then I'm better to buy rather than build. And better yet I'd much rather be the 2nd owner of an asset than the guy that ponies up something that is worth less on Day 2 than it is on Day 1.
I don't know much about the AU situation, but still, I'm not sure what you're trying to get at here. It seems to be working out pretty well for the consumer, given the plans I've seen...?
You've hit the nail on the head - its great for the consumer. And you've completely missed the point. Its lousy for the provider of the services. In 12mths time when the wholesale price is set by NBNCo then how viable are the customers that are already connected? Those ISP's simply dont know.
But lets say that they are viable because the wholesale price is held artifically low - then the returns to NBNCo are sub economic. Fine if you're the Govt and you decide that taxpayers are okay with little or no return (ie its a public good in Economics 101 parlance) but if its NZ and you're the private company that owns (or part owns) that fibre asset? Then thats a poor return that you're delivering to your shareholders.
If something is great for the consumer and poor for the provider then thats not sustainable in the long run unless the State is picking up the tab. For a private business it usually means sustained losses and either divestment or closure.
When you manage to understand the entire value chain and can dispassionately analyse the situation from both consumer and provider point of view then you will get it.