2 Aug 2012

Abandoned internet cable major setback for UFB

11:31 am on 2 August 2012

A director of Pacific Fibre says its abandoned international internet cable project is a major setback for businesses and the Government's $1 billion ultra fast broadband programme.

Pacific Fibre on Wednesday dumped plans to build 13,000km of high capacity, undersea fibre cables linking Australia, New Zealand and the United States, costing more than $400 million.

The company, whose high profile backers included Sam Morgan, Rod Drury and Sir Stephen Tindall said it had failed to raise enough money for the operation.

Mr Drury says he doubts there will be another New Zealand project, despite raising $200 million.

He says if another company wants to have a go they would be happy to share the work that has already been done.

But Mr Drury says it's very difficult to see how it would be possible to get a cable out of New Zealand in the short term.

He says the best that could be hoped for is that somebody will do a small cable from New Zealand to Australia at some time.

Mr Drury says they thought it would be a great business but it's difficult raising a huge amount of money in a very tough time.

Pacific Fibre's aim was to rival the Southern Cross Cable Networks' cable and help carriers make fast, inexpensive, unlimited broadband a reality.

But Mr Drury says one stumbling block in the link to the US was Chinese funding.

He says New Zealanders have to put pressure on the Government to take up the project if they want the ultra fast broadband programme to work.


The Telecommunications Users Association is worried that internet prices will rise and customers might not be able to get the internet speeds they need in the future.

But Economic Development Minister Steven Joyce told Morning Report there are huge amounts of unused capacity on the existing link.

Labour says the Government has to take some of the blame for Pacific Fibre's decision to abandon plans to build a second fibre-optic undersea cable.

Information technology spokesperson Clare Curran says the Government could have done more to support the plan.