Patterson ousted as telecommunications commissioner

The Sky TV, TVNZ and Telecom-battling Ross Patterson applied for another five-year term as telecommunications commissioner but has been replaced by an alternative candidate, Dr Stephen Gale.

On March 30, the Commerce Commission confirmed to NBR ONLINE that Dr Patterson had re-applied for his role.

Yet the government had taken the unusual move of advertising his job without mentioning the incumbent was seeking re-appointment.

In late March, NBR reported a rumour spread widely in the telecommunications industry: that Sky TV and TVNZ were pushing for Dr Patterson's "head on a stake" and opposing his re-appointment.

The accusation was vigorously denied.

Nevertheless, while ICT Minister Amy Adams and Broadcasting Minister Craig Foss said they saw no need for regulation of Sky TV, Dr Patterson repeatedly raised the issue of whether a "near-monopoly" pay TV provider could hinder fast broadband uptake as the broadcast and internet worlds converge.

On May 16, The Commission upped the ante, dismissing a complaint over the pendiing low-cost pay TV service igloo (51% owned by Sky TV, 49% by TVNZ), but at the time opening an investigation into whether Sky’s contracts with internet service providers may be hindering competition and "whether Sky’s agreements for the acquisition of content harm competition by denying actual or potential rivals access to a critical mass of quality content". (The investigation is under the Commerce Act rather than the Telecommunications Act.)

Battle with the bottle
Dr Patterson's term as commissioner was shaded by his battle with the bottle.

He took a 10-month leave of absence for an alcohol-related illness early in his term.

He returned to the office, and his $370,000 salary, in July 2009 after a period of uncertainty and delays, apparently caused by political infighting.

Performed well – Tuanz
The telecommunications commissioner works within the Commerce Commission, working as an industry watchdog and helping to formulate policy that is recommended to the ICT minister (read the MED's position description here. The MED is now part of the new Ministry of Business, Innovation and Enterprise).

Earlier, Telecommunications Users' Association chief executive Paul Brislen told NBR Dr Patterson had performed well.

Recent achievements include the regulation of mobile termination rates (wholesale network charges between phone companies), and successfully pushing for Commission Commission oversight of companies involved in the $1.35 billion ultrafast broadband (UFB) initiative (it had none in the original Telecommunications Amendment Act).

"He's done a lot for consumers while maintaining good relations with the telecommunications industry," Mr Brislen said.

Dr Patterson seemed to have expected to lose out.

Earlier, he told RNZ's MediaWatch he was looking at overseas positions.

Gale: a controversial background
Dr Gale – an Associate Commissioner at the Commerce Commission since July 2010 and formerly with regulatory consultancy Castalia – takes over on July 12.

Castalia gained noteriety in 2009 when one of its directors penned a report stating that copper networks could provide enough bandwidth for years to come.

There would not be enough demand to make fibre-to-the-premise economic under the government's ultrafast broadband scheme, Castalia maintained.

Dr Gales official Commerce Commission bio says  he "has worked on a variety of competition topics including the design of the electricity market, radio spectrum auctions and port pricing. He has advised on mergers in a variety of sectors including forestry, supermarkets, newspapers, dairy products, ready mix concrete, farming hardware, building materials and snack foods."

A major government of 4G-friendly 700MHz spectrum - freed up by the digital TV switchover - is due to take place later this year, or early next year.

RAW DATA: Minister's statement

Communications and Information Technology Minister Amy Adams has today announced the appointment of Dr Stephen Gale as the incoming telecommunications commissioner and member of the Commerce Commission.

An independent panel was convened to consider the 44 applications for the role, and recommended the appointment of Dr Gale.

“The telecommunications commissioner’s role remains a vital one to the success of the industry and it was important we found the best candidate,” Ms Adams says.

“Dr Gale impressed the panel with his wide range of experience in regulated industries and his ability to articulate the role of the regulator to promote the interests of consumers through encouraging competition and ensuring that investors have the incentives to invest over the long term.

“He has an excellent understanding of the issues faced by the telecommunications industry and the various approaches taken by other countries in regulating their telecommunications markets.”

Dr Gale has been an associate member of the commission since July 2010, and has sat on its telecommunications division since February of this year.

The appointment is for a five-year term starting on July 12.

Ms Adams thanked out-going Telecommunications Commissioner, Dr Ross Patterson, for his contribution during the last five years.

“Dr Patterson played an important role in the success of the telecommunications sector during his tenure, including participating in the operational separation of Telecom, the unbundling of the local copper loop, and mobile termination regulation.

"I wish him well in his future endeavours.”