21 Sep 2011

Third undersea cable 'could cut internet prices'

10:50 am on 21 September 2011

A telecommunications lobby group says the sooner another trans-Tasman undersea internet cable is laid, the better.

The New Zealand and Australia market representative of the China Communications Service, Axin, and Huawei Marine are planning a new trans-Tasman undersea internet cable, which they hope to begin building before the end of the year.

The new cable will compete with the existing Southern Cross link, and a cable being proposed by consortium Pacific Fibre which would connect New Zealand to Australia, then on to the USA.

Telecommunications Users Association chief executive Paul Brislen welcomes the extra competition, but says the start date seems remarkably soon.

"Either they've got everything in place and they're announcing at the 11th hour, or it's a bit of a pipe dream, and we'll soon find out."

Mr Brislen says a third cable would increase competition, bring down prices and increase data caps.

He says the new cable might create difficulties for Pacific Fibre's business case, especially as the Southern Cross cable is nowhere near capacity.

But he says the Southern Cross cable doesn't directly connect to the US, which is something New Zealand needs.