Rural broadband initiative down to shortlist of three

Former TUANZ boss backs bid from Kordia/Woosh/FX Networks consortium

Three proposals for the Rural Broadband Initiative have been short-listed, with New Zealand Rural Fibre Group left out in the cold.

Communications minister Steven Joyce announced today that the three are from Torotoro Waea, a consortium of Iwi and other Maori entities; the FX Networks/ OpenGate consortium, which includes Kordia and Woosh Wireless; and Telecom/Vodafone.

Joyce says the short-listed proposals merit further evaluation based on their plans to deliver the RBI objectives and provide open access to government-subsidised infrastructure.

Negotiations will be entered into later this month, he says, with binding contracts expected to be signed early in 2011.

The tender for national coverage will see 80 per cent of rural households get speeds of at least 5Mbit/s and the remainder receive at least 1Mbit/sec. The proposals also offer to connect at least 93 per cent of rural schools to fibre.

The New Zealand Regional Fibre Group, which missed the cut, is questioning why the Ministry of Economic Development is persevering with contracting a single service provider.

CEO Vaughan Baker says the MED should have required the separation of the services from the underlying utility fibre infrastructure.

“It’s disappointing that our wholesale-only, service provider agnostic approach has not been allowed to make the short-list.”

He says it is ironic that NZRFG members have been the preferred choices to build New Zealand’s first urban fibre networks with speeds of 100Mb/sec but may have no direct role to play in taking fibre to the farm.

“Yesterday, Northpower and Ultra Fast Fibre Limited (owned by WEL Networks) were contracted to begin building New Zealand’s UFB network.

“Every other member of our group is short-listed for negotiations with Crown Fibre Holdings to build UFB networks in the remaining 25 urban centres the government has deemed priority areas…so we obviously have a recipe that is of appeal.”

The NZRFG is a group of regional operators, including lines companies and local fibre companies.

Kordia CEO Geoff Hunt says the OpenGate proposal with FX Networks will be a step-change for broadband in rural New Zealand.

“We have put together an extremely compelling bid that will deliver better broadband services to rural New Zealand that urban dwellers currently enjoy under incumbent service providers,” he says. “That’s city quality broadband or better at city prices.

FX Networks would deliver on the fibre component of the RFP, and OpenGate would be responsible for the wholesale wireless access, delivering last-mile connectivity.

Hunt says that if the consortium is successful, it will be able to rapidly begin deployment because 75 per cent of the requisite hilltop sites already exist.

Woosh chairman Rod Inglis says that Kordia and Woosh together have a “whopping” 70MHz of strategic 2.3 GHz spectrum which can be used right now to deliver an LTE solution that will future-proof the connectivity of rural New Zealanders.

The proposed solution would exceed the MED service level targets by delivering 10Mbit/s to 83 per cent of rural New Zealand, and breaking through the 80 per cent coverage target within two years.

FX Networks CEO Murray Jurgeleit says that by opening up the rural sector to real competition rather than further entrenching a duopoly — a swipe at the Telecom/Vodafone bid — this would ensure that rural New Zealand kept up with the world’s best in the years ahead.

The OpenGate/ FX Networks consortium recently hired former TUANZ boss Ernie Newman to look at their bid from both a consumer and competitive view.

“It was very advanced by the time I got involved three or four weeks ago,” Newman says.

“I had a look at the Woosh Probe rollout in Southland as part of the review. Their current technology is better suited to rural than urban.

“Overall, I was pretty impressed with the bid, which can deliver the outcomes very quickly.”

Telecom/Vodafone say in a brief press release that their collaborative, open-access approach would ensure the fastest possible start and would result in more infrastructure, choice of technology and services, and competition for rural New Zealanders.

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Tags RBIRural Broadband InitiativeSteven Joyce

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