Internet tycoon Kim Dotcom is facing a "real stumbling block" as he attempts to relaunch a plan to install a high-speed broadband cable between New Zealand and the United States, an expert says.
Pacific Fibre, the company that hoped to build New Zealand's second international internet link by 2014, was forced to can its ambitious project in August as it failed to raise enough money.
Dotcom told ONE News his new file sharing site could be what is needed to "reboot" the plan.
The Megaupload founder said Me.ga "would fund a share" of the $400 million project, with additional funds coming "from investors and backbone providers".
"Me.ga would be the single largest customer on the new cable and our presence here would attract new internet businesses to open in NZ," he told ONE News.
However, Paul Brislen from the Telecommunications Users Association of NZ told TV ONE's Breakfast the case against Megaupload could prove to be a real stumbling block for Dotcom.
"I really don't see the Americans allowing any project that Kim's a part of to connect a cable to the North American continent; they really do take it that seriously," he said.
"That means either not going to the States building the cable out into the north off to Australia and up to Asia or perhaps landing the cable in Canada if they've got different rules up there or possibly Mexico."
But he said the price of the cable would go up and that is a problem.
He said Dotcom wants to run his replacement for Megaupload in New Zealand.
"He wants to build a datacentre and run the whole thing from New Zealand for that he needs extra international capacity so he's started the project."
'Anything is possible'
Prime Minister John Key told TV ONE's Breakfast it could be a positive step if Dotcom helps finance Pacific Fibre, saying that the Government had been quite actively supportive of the plan and was preparing to underwrite a certain amount of traffic over the Pacific Fibre to ensure that it had a better chance of being financially supported.
"The issue with Pacific Fibre is it had a really star-studded cast of people who were prepared to be involved in the project, from Sam Morgan to Steven Tindall."
Key said that in the end they "couldn't come up with investors that thought it actually made sense".
"Now there's always a case and other people can always bring different things to the mix and anything's possible, but I think in terms of the southern cross cable at the moment, certainly the advice the Government has had, is that there's a fair bit of capacity on there now."
He said there was nothing stopping international and national investors putting their money behind the bid before it fell over.
"The fact that they chose not to and even the individuals were talking about, Steven Tindall and Sam Morgan are fabulously wealthy in their own rights, so in the end they still didn't put up large amounts of their own money, so you have to sort of say ok Kim Dotcom might but he would be doing something other investors didn't want to do."
German national Dotcom is facing extradition to the United States for his role in megaupload.com, and says his "Plan B is to win the case, sue the Hollywood studios and/or the US government for their bad faith, unlawful and political destruction of my business and pay for Pacific Fibre with the damages received".
Dotcom is also proposing free broadband for all New Zealanders. He told ONE News once the cable is installed it is "relatively cheap to maintain".
"We would provide all NZ ISP's with free access to the cable for individual customers (citizens) and charge a fee to business and government customers.
"Because ISP's control the last mile and provide equipment like routers they would still charge a fee but it could be as low as 15% - 20% of current bandwidth plans with three to five times faster connection speeds and without transfer limits."
Dotcom said that "one way or another New Zealand needs Pacific Fibre".
"I think it is important to reboot efforts to make it happen," he tweeted.
The German National said unfortunately the Government wants to invest in roads.
"In 10-15 years more people will work and shop from home. You don't need Tarmac you need fibre."
'A swim at Kim's'
Dotcom yesterday invited Pacific Fibre chairman Sam Morgan and co-founder and director Rod Drury to discuss his plans.
Dotcom tweeted: "@samfromwgtn @roddruy Let's #swimatkims next week and talk about Pacific Fibre."
To which, Drury responded: "@KimDotcom if there's a photo we need to push @samfromwgtn down the end of the pool. He's a whippet #swimatkims."
But he earlier tweeted: "While I admire the @KimDotcom #megacable plan, there is a tiny flaw. US permission required to connect to USA."
Dotcom told ONE News he had meetings with Pacific Fibre chief executive Mark Rushworth two years ago and "he was a big supporter early on".
"I flew in the CEO of Cogent Communications, one of the largest internet backbone providers in the world, to discuss a cable partnership with Pacific Fibre.
"The new Me.ga based in NZ could be what it takes to make this cable happen."
Rushworth reconfirmed his interest yesterday tweeting: "@KimDotcom absolutely agree. Without another cable NZ destined to remain an Internet backwater. Happy to have a chat."
Pacific Fibre chairman Morgan said in August that he was "terribly disappointed" the company's plan to build a high speed fibre-optic cable connecting New Zealand and Australia to California had to be dropped.
Morgan said at the time that despite getting good investor support, the company, which was launched in March 2010, was not able to reach the $400 million needed to fund the building of the 13,000km cable.
Dotcom said that that "one way or another New Zealand needs Pacific Fibre".
Dotcom has received support from his followers on Twitter, with one saying he would put in everything he could in to the plan, as it is an essential piece of infrastructure.
The cable would double New Zealand's bandwidth.