Telecom on a path to creative destruction

There's nothing like "creative destruction"; every so often, a new innovation comes along and replaces whatever it was that went previously, just as cars replacing the horse and cart.

Now, to be fair to Telecom New Zealand, it does have to carry the lines over long distances for such a small population, and for many years it has had to fund the Telecom Services Obligation, and at the time a successor levy, which meant subsidising rural services and offering free local calls.

The government regulators

The government regulators, but, did note that broadband prices in New Zealand are, by contrast, relatively low compared to other countries, something that commentators credit with the unbundling of the "local loop" some years back, fuelling a competitive market for broadband services.

Taken at the same time, ComCom concluded that this could lead to consumers switching over to cheaper digital services sold with broadband; that is, consumers switching from fixed-line voice to voice over IP. And lo and behold, this is already happening!

Few months back

A few months back, Orcon, an ISP, launched a VoIP (Voice over Internet Protocol) and broadband package called Genius, where clients pay no line rentals.

It would seem from the graph that the number of unemployed using the internet has increased by about 50% in the 10 years to 2011. The ot...