Taxpayers should put up $5 billion for broadband: Vodafone CEO

Stanners suggests at Summit that govt increases UFB investment

Taxpayers should foot the bill for the government’s Ultra Fast Broadband network, according to Vodafone CEO Russell Stanners.

Speaking at the Telecommunications and ICT Summit in Auckland, Stanners suggested that the government should increase its investment from $1.5 billion to $5 billion in the UFB. He compared the proposed fibre network to the roading network and pointed out that while $30 billion of public money (for example user road charges, fuel taxes, rates) will be spent on the roading network in the next ten years, only $1.5 billion of taxpayer money will be spent on the Ultra Fast Broadband network.

“Maybe we should do it properly and fully drive it out and look to get us (taxpayers) to pay for it,” he told the audience.

Stanners says the government’s proposed network will transform the delivery of telecommunications in this country, and he says the industry is on the cusp of the biggest change in its history. “Sometimes I wonder if it’s a partnership or if it’s a forced march — is it going to the promised land or is it going to go somewhere else?” he asked.

He used the analogy of a “perfect storm” created by changing customer expectations, the creation of new devices that were changing consumer behaviour and changing business models.

Stanners says Vodafone is interested in investing in the government’s network. Previously he has signalled Vodafone would partner with Axia NetMedia in its national bid to partner with the government. Axia’s plan rivals Telecom’s bid and the proposals submitted by lines companies and independent fibre providers.

But today Stanners endorsed Telecom as a key partner with the government in the network. “If we were to try to do a fibre network that excluded Telecom my money would be that we won’t get there.”

However the network is built, Stanners says Vodafone would be likely to retail services “as long as we can get a $30 to $40 a month wholesale price”. He says customers are not prepared to pay more for faster speeds.