Curran Clare: Telecommunications (TSO Broadband and Other Matters) Amendment Bill — In Committee 
Curran Clare: Telecommunications (TSO Broadband and Other Matters) Amendment Bill — In Committee 
[Volume:673;Page:19568] 
CLARE CURRAN (Labour—Dunedin South) 
: 
 I am pleased to take a call on Part 2 of the Telecommunications (TSO Broadband and Other Matters) Amendment Bill. I will address an issue that lies at the very heart of the Act within which this bill resides and the principle upon which it should rest which is the principle of competition for the long-term benefit of the end users or consumers who are the people of New Zealand.  
I will make some remarks on Part 2 before I get into the substance of it and talk about the amendments that Labour is putting forward on this part in respect of competition and the concept of investment. First of all when investors come to this country they should know a couple of things. The first is that their investment is welcome and that the environment they are investing in is sound and stable because the regulatory and legislative environment is based on the sound principle of competition for the long-term benefit of end users. Secondly investors should know that in this country there is an expectation that corporate interests are not put higher than consumers service and affordability and they should know that they are not put lower either. They should also know that competition is critical because in the telecommunications market we need rigorous competition in order for it to be successful. I hope that during this debate a reference is made to the importance placed on this principle by the previous Labour Government. The Digital Strategy sat within that principle and the Telecommunications Act arose out of it.  
One thing is missing from this whole debate and that is the other side of the equation. If the Minister in the chair the Minister for Communications and Information Technology takes a call at some point during this part I would like to hear his views on the reasons why people connect to high-speed broadband. Although I suppose some voicing has been given to this issue not a great deal of substance has been given to it during the whole of the 2½ years of discussion about ultra-fast broadband and about this network’s roll-out. We have to ask why people will connect to it and what will drive them to make that decision. It is called content which is the important issue; the demand is what people can use the high-speech broadband connections for and what will motivate them to move to make that switch from copper to fibre. The Minister as I said has not seriously addressed this issue. He does not appear to be hugely interested in that bigger vision and he is strangely silent on any consideration of how the content industry might fit into it and what the regulatory environment might look like in that content industry unless as could be feared it is about cementing the way for further monopolies in the content sector as well.  
New Zealand can realise its potential as a nation of technological innovation only if our population is digitally literate and has clear pathways into future education and high-wage high-skilled jobs. The traditional broadcasting sector is transforming and merging with what has been called a telecommunications and information and communications technology sector. We do not have a new term for that sector yet; it is known around the world as convergence. It still has not really been named other than being described as the digital environment. The fact is that the two sectors are coming together. Increasingly content in that digital environment is crossing the technological platforms. Traditional broadcasting as we know it is now rapidly becoming obsolete and the digital environment is the future.  
“Content” describes the creative material that New Zealanders produce—not just in New Zealand obviously—and it is delivered in that digital environment across all mediums. It includes films programmes news current affairs music games etc. It is delivered via all those platforms whether the platform is television radio the internet or print and it will be successful only if people choose to access it and see its potential for the future. To do that people will need access to quality of content diversity of content and adequate competition. That goes to Part 2 and to the importance of providing and making sure that real competition is involved.  
Before I carry on I will mention one of the important amendments to Part 2 that Labour has put forward. It will amend new section 156AD in clause 24 by substituting subsection (2) and it goes to the importance of what is called the equivalence of inputs. I will talk about that in a minute but essentially it will allow that competition to occur on the network itself on the platforms on which the content resides. We say that competition should be allowed to occur from the outset rather than from 1 January 2020. That is a long way away and in this environment where the technology is changing so rapidly the ability to have that competition both at the network level on the delivery of the platforms on which the content resides and also in the content industry—traditionally known as the broadcasting industry—is so important. Therefore the industries should be looked at as one rather than as two. The discussion that we are having about broadband and the roll-out of broadband should also include the content industry. That is what is missing from the discussion in this debate.  
I will go specifically to the open access regime about which Labour had a number of comments to make in its minority report on the bill before us. We consider that the open access undertaking provisions for ultra-fast broadband are severely flawed as they explicitly exclude price and non-price terms for bottleneck services. The limited form of Commerce Commission oversight was discussed at great length at the Finance and Expenditure Committee. We believe that what has been provided for in this bill is not a true substitute for a real open access regime. The undertaking provisions do not require service providers to achieve equivalence of inputs which is the standard that is currently applied to Telecom. As a result there is a real risk that a service provider could provide itself or individual access seekers with better ultra-fast broadband services and more attractive prices compared with others. That is one of the reasons why Labour is opposing this bill.  
Open access is a core issue. It goes to competition it goes to the ability of real competition to occur and it goes to the fear that lies at the heart of Labour’s opposition which is that there will be monopolistic practices and the ability for price gouging to occur and there is history. There is history in this area which we can outline in detail for the Committee and I hope to do so later on. As a result as I said there is a real risk that the service provider could provide itself or individual access seekers with better ultra-fast broadband services and more attractive prices compared with others. That behaviour would be anti-competitive and under this law there is not any remedy to challenge it until 30 December 2019.  
That is why we have put this amendment before the Committee today. We think there must be sufficient incentives for service providers to comply with undertakings. That is why we put forward an earlier amendment which was voted down in the previous part of this bill on the penalties that can be made.