20 Dec 2014

New trans-Tasman cable work confirmed

4:05 pm on 20 December 2014

Three telecommunications giants have confirmed plans to start work on a new trans-Tasman broadband cable early next year.

Internet cable

Photo: AFP

Spark, Vodafone and Telstra were investing about $US70 million on the new Tasman Global Access Cable.

It will run between the Waikato west coast town of Raglan to Sydney and would break the monopoly of the Southern Cross cable.

The 2300km link was expected to be operating by mid-2016.

In 2012, the Pacific Fibre plan, led by TradeMe founder Sam Morgan, to build a 13,000km high-speed fibre-optic cable between New Zealand, Australia and California was called off because of its inability to raise the $400 million required to fund the cable.

Spark chief executive Simon Moutter said the new trans-Tasman cable would give more security to New Zealand's international broadband connections but it did not mean lower prices for consumers.

"What they will get is more assurity. If a ship's anchor was dragged through the cable, they will never see anything happen because we'll have increased diversity," he said.

Telecom Users Association chief executive Craig Young welcomed the cable and said it would keep prices under control.

"What it means is that as the traffic that's going in and out of New Zealand continues to increase, then consumers probably won't see a reduction in their prices but they wouldn't necessarily see an increase that might occur if there was still only one player delivering international cables into New Zealand," Mr Young said.

"So I think that's where the competitive pressures are going to come."

He said he would be watching closely to make sure smaller internet companies had fair access to the cable.

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