Ex-minister muddies telco waters

You can always tell when a debate is about to turn sour: someone invokes either race, religion or Nazi Germany.

You can always tell when a debate is about to turn sour: someone invokes either race, religion or Nazi Germany. Really, it’s the predictable — they’ve run out of real reasons for their point of view and have decided to fall back on the old chestnuts that served so well in the past.

I was very unhappy to see Maurice Williamson doing just that in a media column on the new telecommunications regime. He points the finger at new GSM mobile phone company Econet as being part of “the Econet/Maori consortium” and claims having “friends in high places” -- in particular, Maori members of parliament -- has meant somehow New Zealand is being ill-served by the new regulatory environment.

Let’s recap. Williamson was minister of communications for the best part of a decade, during which time he threatened Telecom on no less than half a dozen occasions that if it didn’t pull up its socks and let the other telcos into the market, he would step in. That never happened, and to my mind New Zealand’s telecommunications sector is worse off for it.

Now, when the government has stepped in and is implementing what must be described as one of the most light-handed regulatory regimes in the world, it’s all too much for Williamson (who is no longer the National spokesperson on telecommunications, it should be pointed out), who likens the legislation to having Winz decide to make you house beneficiaries in your spare room. Honestly, I’m surprised he didn’t invoke communism, or anarchy (its modern-day equivalent), or the lesbian feminist separatist movement.

Here’s another quote for you: “New Zealand businesses should feel a cold shudder down their spines. Who knows whose business might next be coveted by a Zimbabwean/Maori consortium which might again persuade the Maori MPs they should have a slice of the action.” Scared yet? Apparently you should be.

It’s sad, really, because once you get around the emotional indigestion of his rant, there are some good points to be made.

Firstly, the cellphone market is the one part of the telecommunications sector that most people will agree works quite well. There are two competing players, there is a huge amount of growth and prices are quite acceptable on the whole. There’s very little of the “they won’t let us play” attitude that has tended to dominate the fixed-line business over the past few years.

Williamson is quite right when he says letting Vodafone and Econet reach their own commercial decision would be the right thing to do. Vodafone is quite happy to resell space on its GSM network to competing companies, like Econet, and has said so publicly. It would prefer to do so in a commercial environment rather than a regulatory one, and that’s fine too. Because that’s exactly what the coming telecommunications bill promises to deliver. The commissioner won’t step in unless negotiation breaks down and even then he or she won’t fix the price for network access unless all else fails. And surely if Vodafone is as reasonable as it claims to be, that won’t happen.

The other point Williamson raises is that of the spectrum auction itself, and this is a tricky business. The auction was held before the new bill was finalised — a number of those who bid for spectrum are now grumbling about having bought and paid for spectrum that they really don’t need in an environment where they can simply go to a network provider and buy space.

This is a good point, and it highlights just how poorly the previous regulatory regime worked — nobody believed common commercial law would enable them to successfully negotiate with an incumbent network provider for access to the network. If they did, there would have been fewer bidders at the auction and there would now be more companies, like Econet, in the market.

Hopefully Econet is only the first of a number of companies eager to fight it out in the cellular market. I, for one, can’t wait. It should mean lower prices and better deals for the end user and, frankly, that’s what I care about — not whether the company providing the service is a Zimbabwe/Maori consortium or an Australian/Briton commercial entity.

Brislen is IDGNet’s reporter. Send email to Paul Brislen. Send letters for publication in Computerworld to Computerworld Letters.

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