20 Sep 2013

Govt floats new broadband cable project

11:37 am on 20 September 2013

The Government is seeking expressions of interest from businesses which want to build a new telecommunication cable.

The Southern Cross Cable, linking New Zealand with Australia and the United States, is at present the only undersea cable that allows for ultra-fast broadband.

Communications and Information Technology Minister Amy Adams says the Government will commit $15 million to the new cable.

She says that will introduce more competition and provide additional broadband capacity between the three countries.

A similar project was dumped by Pacific Fibre last year because it only managed to raise half the money it needed.

Internet New Zealand says another undersea cable could bring retail prices down.

Chief executive Jordan Carter says more competition could result in cheaper and faster internet.

Telecommunication companies Telecom, Vodafone and Telstra are still planning a trans-Tasman cable.

Telecom and Vodafone say it is too early to comment on whether they will respond to the Government's offer.

Telecommunications Users Association chief executive Paul Brislen says the Government needs to commit a lot more than $15 million to get businesses interested in building the new three-country cable.

He says the cable is likely to cost in the hundreds of millions of dollars.

"I do wonder if they realise the scale of these things. We're talking about a $400 million project and having government support to the tune of $15 million isn't really all that significant in the scheme of things," he says.

Mr Brislen says a new cable could give New Zealand the capacity to become a digital economy by exporting data to other countries.