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So I think it's safe to assume that UBS isn't going to provide the open competition that Swain so proudly crowed about when he made the decision not to force the unbundling of the local loop.

Now we've been told that Telecom is on notice and will be watched carefully so I expect we'll see government step in and tell Telecom not to be so damned stupid in respect to the T&C for UBS -- oh yeah.. porcine aviators are alive and well!

So it's pretty safe to say that the government is now aiding and abetting Telecom in the exploitation of its monopoly... but wait, the situation is actually *much* worse than that!

Remember Project Probe?

That was the well-intentioned initiative to get broadband connectivity out to rural areas where it might have otherwise been uneconomic to do so.

By stumping up a goodly wad of taxpayers' money (aka: *our* money), the government struck deals with various providers to create (mainly) wireless networks that could deliver high-speed internet to many country folks.

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Well, as has been widely reported, Woosh Wireless won a good number of those contracts and was supposed to roll out its service according to an agreed timeframe.

Unfortunately, the rollout hasn't occurred, for a number of reasons.

So now, Telecom is going to take over some of those contracts and deliver broadband to a number of regions. This is good news isn't it?

Well yes and no.

Remember that Project Probe is funded by our money. In effect, taxpayers' funds are being *given* to the various successful tenderers in order to subsidise the creation of the necessary infrastructure.

Now stop and think about this for a moment...

Telecom is now being paid by us (taxpayers) to install equipment that it will then charge us (taxpayers) for the use of.

Sure, without this subsidy then it's unlikely that many of these regions would receive any kind of broadband service -- but should we be simply giving this money to Telecom et al?

I wonder how competing ISPs feel about the fact that they're effectively subsidising a competitor by way of these subsidies?

Surely it would have made far more sense for the money to have been a low/no interest loan or to have created a joint venture between the successful tenderers and the government so that there might be either a return of the principle or some kind of return on the investment being made?

But hang on, in those areas where Telecom is providing the service under Project Probe, at least other ISPs will be able to compete using the UBS right?

Goto Top :-)

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