Broadband in NZ– VLENZ Update, No 181, March 13, 2011

The  New Zealand Broadband network

Rural Kiwis  probably wont see

‘true’  Broadband  for decades

… will Christchurch quake slow implementation

of 2nd-best  RBI solution

Telecom's Dr Paul Reynolds ... rebuked for honesty.

With the government concentrating on the post earthquake resurrection of Christchurch – and the money needed to rebuild that city – one wonders whether the Rural Broadband Initiative which has been badly fumbled, will quietly fade into the woodwork.

And will  New Zealanders outside the main centres and Telco hubs continue to be left in the 20th Century with less than adequate Broadband?

Of course, it is understandable that the contract, which has been awarded to the old-style,  not-likely- to-deliver the Broadband needed for the nation, Telecom/Vodafone consortium with its outdated backward-looking technology, may  go on the backburner.

But one has to ask is  even  the  out-of-date solution to be thrown out with the demolition rubbish from the Christchurch earthquake.

Not that it really matters I suppose because one has to wonder whether the  Government and its advisers on the RBI  ever really wanted to have a competing future-oriented Broadband network outside the main cities.

‘Marketing carrot’

This was made clear by Telecom chief executive  Paul Reynolds, who earned a rebuke for his honesty from the Government, when he  forecast (before the tender was awarded) that it could take two decades for consumers to upgrade to ultrafast Broadband. Dr Reynolds said, although it is clear the Government intends the network should be completed by 2019, it would take at least as long again for all households to start using it. “Twenty years is the number for the progressive uptake of fibre services,” he said.

His remarks mirrored those of the Telstra-Clear NZ chief executive of a few years ago who  said he saw no need for fast broadband  in New Zealand.

FX Network's Murray Jurgeleit ... RBI future-proof solution rejected.

Despite  remarks like these the  major Telcos are still promoting  and selling Broadband throughout New Zealand  at exorbitant rates which they cannot deliver  at consistent Broadband speeds.

Even Telcom’s latest television promotion for its Broadband service fudges the fact that if you join without contract – a “marketing carrot” – you still have to pay $NZ90 to leave, exactly the same  as you would have had to pay if you had a contract, even if  the organisation cannot deliver consistent Broadband speeds.

The worst part of it is that, as the promotions attract more people to Broadband in provincial NZ,  the more the telcos’ services  degrade, particularly outside the main centres and the less reliable and consistent it gets at times of high bandwidth usage such as school holidays, after school and on wet, miserable winter weekends, the times when the average man, woman and child wants to use it.

The Government did have the option of future-proofing Broadband services for the country but failed to take the chance  apparently accepting the Telecom/Vodafone  solution which basically is slow 3G wireless and fast DSL over copper. This was probably because it was advised by those whose hearts have always been with the big players.

The major alternative was and still is the fibre and 4g wireless solution put forward by FX Networks with Opengate (Kordia & Woosh) which would have delivered much faster Broadband to far more rural users than any alternative.

Simply put  the OpenGate/ FX Networks  solution would have delivered a $NZ285m,  10 Mbps or more Broadband connection to 83 percent of rural New Zealand – a third of the country’s population which generates two-thirds of its export income – for as low as $NZ60 per month, with access from within two years – not six as posed by the Telecom consortium.

‘Choice, innovation, competition’

In a press release last month FX Networks Managing Director Murray Jurgeleit said, “In addition to the low prices, we have proposed to deliver extensive new infrastructure for our rural communities. We are committed to delivering guaranteed performance through the latest technology to put us ahead of our international trading partners.

“We can create an environment of choice, innovation and competition to ensure rural New Zealand is well served in Broadband technology for years to come.”

And Kordia CEO Geoff Hunt  who expressed disappointment at the outcome of the tender process, said that OpenGate would have connected a customer at full speed 40 kms from a wireless site,  a significant advance on what could be achieved with copper.

“The combination of fibre and 4G wireless technology enables us to very quickly deploy high-speed broadband to many more rural Kiwis,” he said.
The OpenGate/FX Networks consortium offer was based on the same advanced technology (4G LTE) that’s being installed in Australia, the US, China and India as an upgrade to aging and congested 3G networks.  Hunt said that this technology meant that any individual tower could be scaled up to deliver more than 1.7 gigabits per second, enabling hundreds of users to have ultra-fast Broadband off a single tower without slowing down service.

Geoff Hunt, Kordia ... an opportunity lost

“They (the Government) say they’re going to a proven technology with copper – it’s so proven that it’s being replaced by fibre everywhere,” said Kordia ceo Geoff Hunt.

“The opportunity to deploy much better broadband has been lost. It is really disappointing,” he said.

He claimed the Government decision, and I agree,  has effectively condemned rural communities to suffering from same old duopoly services that continue to under-deliver and hold rural New Zealand hostage.

“The government had an opportunity through the RBI to provide a technology step-change in services for rural New Zealand that would have laid a future-proof and highly competitive foundation for the next 15 years.

Not an “up-to” speed offer

He pointed out that the OpenGate/FX broadband network would have delivered 100 Mbps to rural schools, 10 – 20 Mbps to 83 percent of rural New Zealanders and an impressive 20+ Mbps to 67 percent of rural Kiwis.
“We can support a lot of people on the internet at these impressive speeds at the same time … we are offering 10 Mbps at better prices than in the cities today – not an “up to” offer,” he said earlier. “New Zealanders are sick and tired of high contention ratios and actual performance that bears no relation to advertised “up to” speeds.

I can concur with that having argued with both Telecom and  Telstra that the speeds they were and are delivering Broadband –  even in provincial centres let alone rural areas – is often more like dial-up than Broadband despite them charging  outlandishly for the service.
The OpenGate/ FX Networks’ infrastructure would have been separate and distinct from the existing copper and 3G networks, and it would have fostered much needed head-to-head competition with the moribund Telcos.

Now sadly it looks as though many of today’s rural New Zealanders probably will not get “real” Broadband at their homes in their lifetimes, even with the latest advances in copper wire technology.

This will only serve to place  rural  residents – adults and students – at an even greater disadvantage to their city cousins in a world where consistent, reliable fast Broadband is becoming a necessity rather than a luxury, especially in the area of distance education.

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