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425 posts

Ultimate Geek


Reply # 34812 4-May-2006 15:20
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Jama: Telecom has done more to improve broadband than the government has done to improve roading, the security of electricity supply or hospital waiting lists.

$4.5b was a lot of money on 1990 which is when LABOUR sold off Telecom. Again - sing along....

'Labour sold Telecom and now they want it back...'


Whoa, I think your comments on roading, etc might be a bit off-topic.

They don't want Telecom back - I'd be seriously worried if they did.  They are just introducing the same regulations that the US and all EU states have introduced.  The case is put nicely by the article on LLU at Wikipedia (http://en.wikipedia.org/wiki/Local_loop_unbundling#U.S.)

LLU is generally opposed by the ILECs, which in most cases used to be state monopoly enterprises before the telecommunications sector was liberalised. They argue that LLU amounts to a regulatory taking, that they are forced to provide competitors with essential business inputs, that LLU stifles infrastructure-based competition and technical innovation because new entrants prefer to 'parasitise' the incumbent's network instead of building their own and that the regulatory interference required to make LLU work (e.g. to set the price) is detrimental to the market.

New entrants, on the other hand, argue that, since they cannot economically duplicate the incumbent's local loop, they cannot actually provide certain services, such as ADSL, without LLU, thus allowing the incumbent to monopolise the respective market and stifle innovation. They point out that alternative access technologies, such as Wireless local loop (WLL) have proven uncompetitive and/or impractical, and that under current pricing models, the incumbent is guaranteed a fair price for the use of his facilities, including an appropriate return on investment. Finally, they argue that the ILECs generally did not construct their local loop in a competitive, risk-fraught environment, but under state monopoly protection and using taxpayer money, which means - according to the new entrants - that ILECs ought not to be entitled to continue to extract monopoly rents from the local loop.

Most developed nations, including the USA and the EU Member States, have introduced regulatory frameworks providing for LLU.

ILEC = incumbent local exchange carrier (Telecom in NZ's case)


[Moderator edit: hyperlinked Wikipedia entry]

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Reply # 34814 4-May-2006 15:31
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cokemaster, don't think I used that example very well... here's a better one

say your a farmer (currently looking at degradation in your telecommunications services, but that's another story), and you buy some land off the government... and you put the best milking shed in the country on your land, for your cows... all the other farmers get jealous cos they can't milk their cows as well as you... so they go to the government and say "You sold cokemaster the land, sort it out or we'll blame you when the kids in school can't have our milk on their weetbix!!"... so the government comes to you and says, "look this is about the kids in schools", let everyone else use your land, or we'll pass a law and force you to... so you say "how about some compensation from them?"... and the government says "nah, we changed our mind, we're gonna pass a law that gives the other farmers open access to your land and your milking shed!"

so cokemaster, you bought the land, you built the shed, deal was done! but the rules changed... that's what's happened here... Ihug et al just got a better deal than the $4.5 billion Telecom was sold for... they got it for a bit of lobbying, some scare tactics, and a bit of manipulation of the media...




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Reply # 34815 4-May-2006 15:33
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I don't think my comments re roading, etc are off topic if you consider the context in which this has been undertaken. Broadband is held out as the saviour of the knowledge economy for the future of a little country at the bottom of the planet. My point is there are other more important enablers that have not been addressed by Labour.




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Reply # 34817 4-May-2006 15:35
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JonC, America has nukes, fat kids, crack, a few wars etc... not sure they are a good example for anyone to be following... it would be interesting to compare broadband connection rates to racial segregation in the US... or look at broadband in rural areas..

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Reply # 34818 4-May-2006 15:39
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JonC: Whoa, I think your comments on roading, etc might be a bit off-topic.


I 100% agree.  Can we get this very interesting threed a little more on topic people.  I'm not really interested in who you vote for, I'm interested in your views on the issue.  Now back to the issue...

-----------------------------------------------------------------

Reality check here guys...  JonC I think you made some very interesting points in your posting but they're off the mark as to what's behind this who issue.

We just hosted an internet confrence in Wellington with over 700 deligates from 90 counteries.  Some of the biggest players in the world have been venting their frustrations about internet access in our hotels in Wellington city.

It is true that NZ is in the bottom of the world ranking in OECD.  It is true that NZ want's to present it self with an image on the world stage.

Fact:  We failed to deliver our 700 visitors with a quality internet experience while they were here and someone is going to pay for that! 

I suggest to you that the Minister and perhaps even the Prime Minister got a 'Please explain' from more than one of the big players while they were here.

In my view this UBL issue has come about as a direct result of this failure to deliver and the Minister is not going to be embarrised again!

I suspect they sat down with TG and talked about the issue.  TG needs a mandate to get thing rocking along.  She answers to a board who simply won't invest in capx unless there's a serious reason to. 

Cheers Don




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Check out mine - i.am.a.can.do.kiwi.nz - don@i.am.a.can.do.kiwi.nz


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Reply # 34819 4-May-2006 15:40
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While we are on the roading topic did anyone see this?

Deputy Prime Minister Michael Cullen later chimed in after Telecom defended its moves saying: "Our superhighway seems to function with several lanes permanently closed with inexplicably high tolls and with flashing lights warning users to reduce speed."

I had to laugh, thinking yes never mind our superhighway this sums up our roading, especially in Auckland, pretty well.

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Reply # 34821 4-May-2006 15:41
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Felix:

say your a farmer (currently looking at degradation in your telecommunications services, but that's another story), and you buy some land off the government... and you put the best milking shed in the country on your land, for your cows... all the other farmers get jealous cos they can't milk their cows as well as you... so they go to the government and say "You sold cokemaster the land, sort it out or we'll blame you when the kids in school can't have our milk on their weetbix!!"... so the government comes to you and says, "look this is about the kids in schools", let everyone else use your land, or we'll pass a law and force you to... so you say "how about some compensation from them?"... and the government says "nah, we changed our mind, we're gonna pass a law that gives the other farmers open access to your land and your milking shed!"

so cokemaster, you bought the land, you built the shed, deal was done! but the rules changed... that's what's happened here... Ihug et al just got a better deal than the $4.5 billion Telecom was sold for... they got it for a bit of lobbying, some scare tactics, and a bit of manipulation of the media



What other farmers are you talking about here?  The ones with no land?  The ones that have to lease land from the first farmer at rates set by that farmer.

The fact is that there is only one piece of land - it makes no sense for anyone "build" a new piece of land.  So the fairest thing to do is for the govt to set the price that land can be leased out at.

BTW, I did some research (after being rudely accused of not doing enough) and apparently Telecom Corp (the state enterprise) bought the PO's telecoms assets for $3.2 bn in 1987 and then Telecom Corp (including new mobile business and improved networks) was sold on to Bell Atlantic and Ameritech for $4.25 bn in 1990 (Wikipedia, my faithful research friend).


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Reply # 34823 4-May-2006 15:46
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Don - I am surprised you blame Telecom for the lack of broadband at hotels for your delegates. Blame the hotel. In Wellington there are many options besides Telecom. Citylink can pump fibre to the door, TCL have a presence and so do Woosh.

Let me put it you this way - You failed to deliver internet to 700 delegates.

And no different to any business - why invest in capex if there is no return or compelling reason. This is business not a charity.




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Reply # 34824 4-May-2006 15:46
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bradstewart: There is nothing on the National site. Both National and ACT have come out against it. At least somebody has brains in Wellington


National appear to have pulled the press release by John Keys supporting the decision from their website.

There'a a good story for you Juha! I have a copy of the document and the link on my PC at home, will post them later on.



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Reply # 34825 4-May-2006 15:47
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Felix: JonC, America has nukes, fat kids, crack, a few wars etc... not sure they are a good example for anyone to be following... it would be interesting to compare broadband connection rates to racial segregation in the US... or look at broadband in rural areas..


Again, a little off topic - what on earth has racial segregation got to do with anything?  If you don't like the US, pick a EU state that you do like, anyone will do, they've all implement LLU.

I would have to agree with you that rural broadband will probably suffer because of LLU, but I guess that's just something you have to deal with if you live in a small town.  Cheap houses, plenty of land, wildlife on your backdoor, clean air, but bad broadband...



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Reply # 34826 4-May-2006 15:50
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JonC - Wiki is not always right.

1987 - Telecom did purchase the telecommunications assests of NZ Post however in 1987 Telecom was an SOE (State Owned Enterprise) not a public company as we see today. That didn't happen until 1990 when Labour sold the SOE to Ameritech and Bell Atlantic.





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Reply # 34827 4-May-2006 15:50
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Felix:

Jama, you beat me to it... just! $4.5b to Ameritech and Bell Atlantic... $4.5b... the b is for billion!

ULL is be like telling CCH they have to let anyone who claims to be a competitor grow trees on their land... or telling ANZ Bank they have to let customers from other banks be served by their tellers..

Telecom is not owned by the NZ govt (though it is about to be run by it) it is owned by the share holders...

Perhaps I should stop complaining and move to the slightly more free country of Cuba... at least the weather is better, and I hear the cigars are great... not sure about the broadband speeds though ;-)



How about comparing ULL to the ATM network? Banks realise that if they all duplicated their ATM networks it would

a) Cost a lot of money

b) Result in a duplication of resources with ATM's all sitting next to each other

So the banks effectively offer ULL on their ATM's and let other banks customers use their ATM's in return for a fixed commercially agreed fee. Makes a lot of sence really doesn't it - much like ULL.




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Reply # 34829 4-May-2006 15:53
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Jama: JonC - Wiki is not always right.

1987 - Telecom did purchase the telecommunications assests of NZ Post however in 1987 Telecom was an SOE (State Owned Enterprise) not a public company as we see today. That didn't happen until 1990 when Labour sold the SOE to Ameritech and Bell Atlantic.



No, that's just what I said - have another read:

Jonc
BTW, I did some research (after being rudely accused of not doing enough) and apparently Telecom Corp (the state enterprise) bought the PO's telecoms assets for $3.2 bn in 1987 and then Telecom Corp (including new mobile business and improved networks) was sold on to Bell Atlantic and Ameritech for $4.25 bn in 1990 (Wikipedia, my faithful research friend).


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Reply # 34830 4-May-2006 15:54
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Not really sbiddle because I get charged as a customer for using another banks ATM. The cost is passed on. If you apply that argument to ULL then you are saying that I will charged for sending you an email via my ISP to you on your ISP.





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Reply # 34838 4-May-2006 16:09
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Jama: Not really sbiddle because I get charged as a customer for using another banks ATM. The cost is passed on. If you apply that argument to ULL then you are saying that I will charged for sending you an email via my ISP to you on your ISP.



An ISP taking advantage of ULL will effectively be paying $x for leasing the copper and directly passes on that cost to me as it's included in the price I will be paying for internet access. The ATM vs ULL argument is used as a perfect example on the benefits of ULL.

BTW link to National Party Press Release support ULL is here:

http://www.national.org.nz/Article.aspx?articleId=1920


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