Dairy giant Fonterra has upset organisations working to improve Internet access for people in rural regions of New Zealand.

Fonterra's initiatives to gain fast Net access for the country's 13,000 dairy farmers have sparked protest from parties concerned that regional undertakings aimed at improving access for all people in rural areas will be derailed.

Ian Walker, president of the Northland division of Federated Farmers, who also serves as the regional broadband project coordinator for the Northland Regional Council, expressed concern that a company of Fonterra's size will cherry-pick the best Web access solutions for its members, sidelining attempts to provide a web solution for the entire community.

A report for the Otago Southland Broadband Communications Committee mirrors Walker's concerns. The report indicates worries that the entry of a universal provider to serve the most lucrative customers - large companies - will raise the barriers for companies looking to reach other potential subscribers.