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Time for the tech sector to get off the govt teat

The tech sector needs to put its money where its mouth is, after the collapse of Pacific Fibre.
Written by Darren Greenwood, Contributor on

The collapse of the NZ$400 million Pacific Fibre was very disappointing, but even more disappointing is how the tech sector is so unwilling to help itself, despite having the ability to.

Already, we have a deeply indebted government forking out NZ$1.5 billion on Ultra-Fast Broadband (UFB), and some in the tech sector wanted further handouts.

Paul Brislen of the Telecom Users Association wanted the New Zealand Government to invest in the Superfund, just as the Australian Government is doing with its National Broadband Network (NBN).

I accept that the Pacific Fibre project would have benefited the country immensely, such as bringing cheaper broadband prices. It would also have widened our "dirt tracks" to overseas.

But as ICT Minister Amy Adams said, New Zealand's UFB doesn't need the extra cable to work effectively. We also hear that the existing Southern Cross Cable still has capacity and it is "too risky" for the NZ Superfund to step in.

E-commerce poster boy Sam Morgan slammed Minister Adams for being out of her depth. That may be true, but if the business case stacked up, then surely Sam Morgan and his co-investors could have found the cash.

None of them are short of a few dollars. Peter Thiel is an internet billionaire. The National Business Review reported in its recent Rich List that Rod Drury of Xero fame is worth $120 million and Sam Morgan is worth $230 million.

Though Thiel and Drury have received corporate welfare in the past, they are both rich enough to not need any further taxpayer support.

Sam Morgan has so much cash that he has said he will give it away before he dies, and it was just two years ago when he bleated at not having to pay Capital Gains Tax from his NZ$700 million sale of Trade Me to Fairfax.

Yet, here we have a chance for the tech sector to put their money where their mouths are, and for Morgan to "give back" to the country that gave him so much. He could look at his investment as the tax he wanted to pay.

Yes, it is sad that Pacific Fibre has failed, but even sadder is the pathetic response of the tech sector over the project, with some tech leaders, despite their massive wealth, would rather suck off the government teat, instead of showing leadership and taking the risk themselves.

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