Telecom yesterday laid down a challenge to the Government to involve the company in the ultra-fast broadband project and avoid unnecessary duplication.
Both chairman Wayne Boyd and chief executive Paul Reynolds made it clear Telecom wanted to be at the heart of the much-talked-about UFB project and was prepared to work hard for its involvement.
"Telecom already has more than 25,000km of fibre optics in operation today. That's roughly half of the total required to extend fibre to 75% of New Zealand," Mr Boyd said.
"Frankly, wasting taxpayer funding and private investment on duplicating a network that is halfway complete is economic madness."
The tender process was being run by Crown Fibre Holdings, the arm established by the Government to agree on the commercial terms for building fibre in 33 localised regions.
That process precluded any telecommunications company that both owned infrastructure and sold services to end users from taking an ownership stake in any fibre that got built, he said.
That essentially prohibited much of the current telecommunications industry in New Zealand from participating unless sweeping changes to the industry structure occurred.
On August 2, Telecom submitted a detailed proposal that was a package containing several components, Mr Boyd said.
They included splitting Telecom into two separate companies - one that built and maintained infrastructure and another that sold services to end users.
Also, Telecom would invest with the Crown to deliver a national fibre to the home network that met the 75% objective, and beyond.
Telecom would also integrate the separate rural broadband initiative to deliver fibre to areas hard to reach.
"For Telecom, much more than any other participant, involvement in UFB is complex. But the potential rewards are also much higher for all concerned.
"By extending, rather than replicating, our 25,000km of fibre, Telecom can deliver more fibre, further and faster than any other participant," Mr Boyd said.
Dr Reynolds said Telecom "was up for fibre" and the company's fibre-to-the-node programme (FTTN) showed that. However, UFB would be a further step-change well beyond FTTN.
"Now we need to seize the opportunity to take the next leap forward and combine available public money with private capital in the most efficient way possible to get more fibre built."
Telecom could solve the associated economic, financial and public policy changes with open dialogue and a willingness to consider new ways of doing things - without wasting what had already been built.
Telecom's plan was national as nothing else made sense for an incumbent's investors. But it did allow for local and community sources of capital to be included.
"We have offered structural separation to meet the Government's key requirement and remove once and for all the lingering perception of unfair advantage between the network and the retail businesses," he said.
"This is a huge step to take and no other telco anywhere in the world has effectively hived off its access network."
It was probably more straightforward for Telecom than others because it had already massively invested in systems changes for operational separation.
"We think partnering with government on UFB and structural separation is definitely worth considering provided we can agree a better regulatory framework with lower ongoing investment costs and less strangling regulation of our retail businesses," he said.
Both Mr Boyd and Dr Reynolds reassured shareholders nothing would happen without their support.
