When Crown Fibre Holdings announced the first three companies to have got through to the next stage in negotiations for the government’s Ultra Fast Broadband plan it took everyone by suprise — not least the three successful bidders, who only heard half an hour before the official announcement.
All three contenders are lines companies and members of the New Zealand Regional Fibre Group, but that’s where the similarity ends — their experience as providers of broadband fibre networks differs widely.
Fibre to the home already
Northpower — the lines company selected to negotiate to partner with the CFH in Whangarei, with a population of around 50,000 — already has a 100km fibre broadband network serving the city's central business district. Fibre and marketing manager Darren Mason says about 60 percent is strung along power lines and it offers Layer 2 services with a xPON deployment (in essence point to multi-point).
Northpower began its fibre deployment three years ago, and in the first year of operation TelstraClear had exclusive rights to offer Layer 3 services. Since then it has opened up to several retailers, including a local ISP Xf network which offers a home broadband and voice package of 5Mb x 5Mb with 10G Datacap for $79 a month.
Mason says Northpower has invested “millions of dollars” in its fibre broadband network, most recently spending $500,000 in pilot fibre to the home in 20 streets in the suburb of Kensington.
Central North Island consortium
A consortium of four providers — Hamilton Fibre Network, Waipa Networks and WEL Networks — are negotiating to be the Local Fibre Company for six regions. These are Hamilton (including Cambridge and Te Awamutu), Tauranga, Tokoroa, New Plymouth, Hawera and Tauranga. This covers about 12 percent of the population in the UFB geographical footprint.
The Hamilton Fibre Network has around 50kms of fibre connecting businesses in the CBD. It was formed by the University of Waikato, Wintec, Environment Waikato and Hamilton City Council, who combined their fibre assets and worked with Velocity Networks to create fibre network in central Hamilton.
WEL Networks CEO Julian Elder says that the intention is for WEL to buy the Hamilton Fibre Network assets and become the majority shareholder. It has combined with Waipa Networks, because its areas — Te Awamutu and Cambridge — were included by the government in one of the elected regions.
Other than internal fibre networks, WEL has not built fibre broadband network, so why were they picked by CFH?
“We’ve been very open to ideas that should help drive the cost down and we’ve also been open to partnering and we’ve made that clear early on,” Elder told Computerworld.
Would you partner with Telecom? “That’s a good question, unfortunately I can’t say much because we’re subject to confidentiality.”
WEL spends $40 million a year on its capital program and assuming negotiations are successful, Elder says that amount would increase to $60 million.
Alpine Energy is a complete novice when it comes to fibre broadband deployment, with just a small existing network connecting its electricity assets. However, chief executive Andrew Tombs isn’t daunted by a lack of experience.
“It doesn’t need to be any more complex than the electricity business, rather than transporting electrons, you're transporting photons, or data,” he says.
Alpine Energy is set to partner CFH in the Timaru LFC, which covers a population of around 20,000. Together with its subsidiary contracting company NetCon, it employs 100 staff and Tombs says the company is ready to lay fibre.
“If we successfully negotiate with CFH there’s no question we can get something in the ground before the end of the year,” he says.