Telco in 10 years, regulation and the ICT portfolio

Part two of Q and A with ICT Minister Steven Joyce

In the second part of Computerworld's Q and A interview with ICT Minister Steven Joyce he shares his views on what telecommunications will look like in ten years time, discusses content and mobile regulation and looks ahead to what the ICT portfolio might be like post-election. In 10 years time what will telecommunications look like?

In terms of what faster broadband is going to deliver, I think we know some of what it deliver and I think we have no idea what other things it might deliver. Nobody had ever thought of Twitter before it happened. So there will be others, and one of the reasons I think it moves so fast in terms of products and services is because its easy to roll it out.

But in terms of industry structure, I don’t know.

There’s bound to be more evolution because as the industry itself moves fast, the structure moves quite quickly as well.

Taken in an international context, everybody thought the Microsoft was the behemoth that would never be overtaken; they’re not saying that anymore ten years later. Now they’re all worried about Google.

In an industry that moves that quickly you can’t say there won’t be further structural change. I was talking to Lord Stephen Carter, who was the British ICT Minister and I’m not sure I agree with this, it’s a bit too cynical; his view is the structure changes every five years.

It’s certainly true in New Zealand.

So far it is. Maybe he’s right. But there will be more evolution I’m sure. I think we’ve made it as durable as we can knowing what we know which is with the infrastructure player, the strong competition in the retail layer, the unbundling of the layer two at the appropriate point in the future.

The cellphone competition, the release of 4G spectrum. I think as we stand today we are the best prepared we could be.

What about content, what about broadcasting? There’s a big study going on in Australia right now from your counterpart Stephen Conroy, to look at the convergence (between telco and broadcasting), where do you see that, where does National see that convergence?

Instinctively I don’t see that convergence is occurring because the reason broadcasting content has been held pretty closely, as an old broadcaster, is because the number of channels has been quite limited. If you owned the channel then you pretty much owned access to content. As the number of channels has increased, the power has moved back to the content provider or the consumer.

Take the music model, it’s been very damaging for the keepers of content, it’s damaging for those that sell CDs and it’s damaging for the big record companies. If I’ve got a band I can go online and sell tracks, it’s a more direct consumer model and I think the same thing will happen with pictures.

So you think the UFB will be damaging for Sky TV?

I think it will be challenging for the Sky model and I think they’re aware of that actually.

So no regulation required?

You never say never because sometimes things take longer than they do. But it stands to reason that content owners have many more channels to distribute their content on and many more ways to do it, where they own the content more and they control delivery of it.

So you will see big sports franchises and bid movie franchises eventually doing a straight pay per view, or straight subscriber view model to their customers.

I’m not hearing that National has an appetite to create an investigation similar to what’s happening across the Tasman.

The Commerce Commission is doing a demand study. That’s what they do and I think that will be interesting.

We don’t have an appetite to rush in when it’s not apparent necessarily why you’re rushing in, in terms of where the model’s going to evolve. Regulation should always be something you hold in reserve as much as you can until you are confident the market can’t work it out.

Regulation – mobile termination rates is another big one you’ve been involved in.

Yes, we nailed that one.

Now you’re looking at trans-Tasman roaming, are you going to nail that too?

That one is a cooperative [effort] with the Minister Mr Conroy and the Australians so it’s just harder because of the dimension of working across the boundaries. But we’re making progress and in the meantime the prices are dropping so people are reading the tea leaves and I would encourage them to keep going.

4G spectrum, that’s for the next government. I guess it would presumptuous to think you would be sitting around that cabinet table, but if you were what are your thoughts on how 4G spectrum is going to play?

We’ve made the commitment to get it out there as quickly as reasonably possible.

So we’re going to be, as we want to be, digital leaders as a country and we see it as a competitive advantage to get it out there.

The government will want to ensure it is done as efficiently as it can and to be on a competitive basis.

With the Treaty of Waitangi claim, you and Pita Sharples are working on this together in parallel to what the MED is doing. What is the progress there? And will that change depending on the make up of the next government?

If it’s not us, then others might have a different idea — as they will on lots of things. There’s a reasonably well-worn historic process around this stuff which is that governments do see a role for iwi participation in spectrum both for Maori language purposes and development purposes.

It’s just about how that works and those discussions will continue.

Is it going to be similar to what happened in 2001?

Don’t know.

The role of the ICT Minister, are you going to be it next time?

Don’t know, there are a couple of preconditions. One, we have to win and two, the Prime Minister has to decide if he likes me and I’ll do whatever he wants me to do.

But what is the role for the ICT Minister now that you’ve ticked all the big boxes?

I like to feel we’ve got through the workload a bit, so hopefully whoever it is, whether it’s me or someone else, will not quite have the same.. but anyway there is still lots to do, delivery is important, it’s going to roll out over a period of time.

Making sure that the country gets the benefits of the investment. That the demand occurs, we have to make sure that the government’s side of the use of it is actually done well and there’s a lot of work to do there. It’ll be different, but there will be stacks of work.

STEVEN JOYCE – SNAPSHOT

Favourite mobile device: iPhone 4

Car: Alfa Romeo 159

Favourite website: none in particular, mostly looks at news sites

Most admired person: no individual but as a group of people most admires “people that create companies and go out and sell stuff to the world”

Most important ICT innovation: the internet

See part one of Q and A interview with Steven Joyce here.

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