For starters, at least the US government wouldn't have their fingers in my data. I'd tolerate high latency for that.
Second, There are millions of people living relatively close to New Zealand, so not everyone will have high latency.
Second, There are millions of people living relatively close to New Zealand, so not everyone will have high latency.
It seems like the idea here is to prevent Mega's "legally challenged" (as another commenter put it) servers from being disconnected by going all the way up the 'chain of command' and creating his own backbone. He intends to give the backbone legitimacy (to forestall any funny business at the PoP) by providing free internet to New Zealanders, thus generating large amounts of 'legitimate' traffic on the link.
Edit: Just to be clear, like rdl, I don't actually think this is a worthwhile thing to do.
You could also build a cable system with huge bandwidth, 99% legit NZ origin traffic (or onward transport from AU), encrypt everything, run the cable to Los Angeles, and then buy a bunch of transport from 1 Wilshire to various locations outside the US. Encrypt your "special" traffic all the way to the various locations, announce your routes there.
None of it is airtight or bulletproof, but you can add layers of obfuscation, some of which also slow legal proceedings (some of which are still civil, some are criminal).
Still probably not worthwhile. Ultimately the best strategy for "challenging hosting" is to replicate the content itself as widely as possible, then build some kind of blacknet to send transactions and command and control. This is capable of resisting arbitrarily strong efforts at censorship.
(A great way is to distribute encrypted data widely, then drop the key at some point in the future. That's the "wikileaks insurance file" approach.)