The New Zealand Government's $15 million plan to encourage industry investment in a new Trans-Tasman fibre cable has fallen flat after industry showed little interest in taking up the initiative.
(Nile Creek Terminal image
by Kam Abbott, CC2.0)
According to the Research and Education Advanced Network New Zealand (REANNZ) — a government-owned company set up to own and operate a high-speed telecommunications network for research and education — there were several parties that were planning an investment in a new cable, but they required the commitment of a "significant anchor tenant" to make the business case acceptable.
October last year saw REANNZ put out a request for information looking to get a feel for the suppliers that might have been able to fulfil its needs.
The company received only four responses, of which only one — supplied by government-owned telco and broadcasting infrastructure builder Kordia — was considered to be compliant with the criteria outlined in the request for information.
After that result, REANNZ decided not to put out a request for proposals. Kordia's cable project was still in the planning stages, so the agency decided not to skip the proposals step and negotiate directly with them at this time.
Kordia said it wasn't surprised at the news. According to Kordia's general manager strategic development, Susie Stone, Kordia has always advised REANNZ that its submarine cable plan, which is still going ahead, would not be ready for service until 2011.
REANNZ is now evaluating its current options to ensure that the education and research community gets the bandwidth it needs.
"We fully understand REANNZ's need to secure connectivity for [its] network when its current commercial arrangements expire in September," Stone said in a statement.
Stone said its cable had wide support in the market and that the company's board would be considering the business case for its cable in September. "It has now been recognised that success for the government's broadband policy requires lower-cost international bandwidth... We hope that today's announcement from REANNZ does not preclude them from negotiating with us on a longer term strategy."
