Annoyingly our Government have decided to give a bag of money to our two largest telecommunications companies, Telecom & Vodafone to build a rural wireless network. The Government have further specified that end of life 3G technology should be used rather than the latest generation 4G LTE currently being deployed overseas (NZ Herald) and (Rural Connect)

Sadly, once again, and with the best possible intentions, the minister looks to have set back telecommunications in this country by years. Giving dollops of cash to the major telco's to extend their services (using old techniology) will exclude and probably decimate the many niche providers that have set up to exploit weaknesses in the big boys coverage.

There is little incentive for small players to invest in developing new or extended services when they are up against hugely powerful, government funded, incumbents.

Telecom and Vodafone continue to languish at the bottom of Consumers' ISP satisfaction table yet they have between them more customers than all the other ISPs put together. It's incomprehensible to me why the Minister would think that smaller ISPs would want to put their equipment on these new rural towers which, by definition, are in sparsely populated areas. There's just no sensible return on the investment!

Worse yet the Government are planning to legislate that the Commerce Commission will not be allowed to regulate the cost of these services for 10 years.

Sounds daft to me. You can count on it that I won't be investing in telecommunications in NZ again until the dust has well settled.

Declaration of interest: Bob is one of the founders and remains a small shareholder in one of the failed contenders, FX Networks