Govt faces delay on $400m 4G auction as Maori revive Waitangi claim
The government's plan to auction 4G spectrum in September or October faces delay, with Maori claimants to spectrum rights reactivating a dormant claim to the Waitangi Tribunal by seeking an urgent hearing on it.
Pundits are picking anywhere between $200 million to $400 million for Crown coffers from the auction of airwaves freed up by the switchover from analogue to digital TV - which are suitable for the new fourth-genertion mobile networks being rolled out by Telecom, Vodafone and 2degrees. A similar auction across the Tasman raised $A1.96 billion for the Australian government
The tribunal's chief judge Wilson Isaac issued a direction for an urgent remedies hearing yesterday after receiving an application on July 4 to reactivate the claim, known by its case number as Wai2224.
Parties have until the end of this month to file affidavits, with tribunal sitting times and the claimants' legal strategy unclear at this stage. The issue has the capacity to be a replay of the brinksmanship that delayed the partial privatisation of Mighty River Power.
Telecommunications Minister Amy Adams told BusinessDesk the government intended to proceed with the auction of 4G spectrum in the 700 Megahertz range in September or October, but could not rule out the potential for delay because of the claim.
Clearly irked by the timing, she said: "It's nearly five months since I announced our plans and I would have thought that's been more than sufficient time for claimants to go back to the courts beforehand."
That plan is to make $30 million available in funding to develop Maori capacity in information and communications technology, and is a variant on the way the last Labour-led government handled similar claims for 3G spectrum rights in 1999.
Breached the Treaty
On that occasion, the Waitangi Tribunal ruled the Crown was breaching the treaty by creating private property rights in digital spectrum without making an allocation for Maori. The government then disagreed, but made $5 million available to allow Maori to bid in the 3G spectrum option.
That saw Maori interests pay a total of $14 million for 3G spectrum rights that eventually underpinned the creation of 2degrees, which has brought fresh competition to the New Zealand mobile telephony market, previously dominated by Telecom and Vodafone.
"That was a great outcome for the whole of New Zealand," says Antony Royal, a director of the Hautaki Trust, which holds a 10 percent stake in 2degrees on behalf of Maori owners. "The Crown should be saying: 'that was really good, let's figure out what else can we do together'."
However, Ms Adams says it is questionable whether owning spectrum is the best way to address one of the claimants' underlying concerns, which is to be able to use modern communications technology to foster the Maori language and culture.
"You have to ask what's the best use of that funding," she says, noting there had already been substantial mobile and broadcasting spectrum allocated to Maori, not all of which was in use.
Instead, "completing the (4G) auction may give headroom for protecting the Maori language in a digital world".
Ms Adams says the tribunal hearings would cover ground that had "already been through the tribunal twice".
"We have never accepted that spectrum is a taonga (cultural treasure), but that the language is. We don't therefore accept that there's an automatic claim to spectrum."
The next step in the auction process is for the government to set a reserve price, which Ms Adams indicates will be a balance between wanting swift development of new fast mobile services – especially in rural areas where the 700MHz range will boost speeds more economically than higher bandwidth spectrum – and the costs of clearing the spectrum to be available for mobile operators.
Some $157 million has been spent on moving analogue television reception, using the 700MHz range to digital broadcast, with the whole country on track to be switched to digital by the end of this year.