TradeMe founder Sam Morgan says plans for another data cable between New Zealand and the United States will help the Government's new broadband plan.
Crown Fibre Holdings this week announced Telecom will build 70% of an ultra-fast broadband network costing $1.35 billion.
About 80% of online activity in New Zealand requires a connection to the United States and the Southern Cross cable across the Pacific Ocean is the only link.
That means Telecom New Zealand, which owns half of the cable with Optus and Verizon, sets the price of connection to the US and therefore our internet caps.
Pacific Fibre wants to change that by laying a new independent cable to provide a competing service.
Mr Morgan says the Ultra-Fast Broadband Network will need data caps to be removed to be successful, which is what Pacific Fibre's cable would do.
He says the venture will cost $US400 million.