Telecom New Zealand's Australian business, AAPT, has flagged it will keep connectivity rather than content at the core of its business, despite launching 24/7 unlimited ADSL2+ broadband onto the market.
The new offering, which also features a deal with EMI for A$50 of music downloads per month and unlimited music streaming, did not signal a move by the telco toward becoming a digital content provider, according to AAPT’s CEO Paul Broad.
“We are a telco, an enabler, we are not experts on content,” he said. “We try to do the things we do well, and we create the environment for others to come along and provide the content.
“Telco’s becoming content providers is the model we’re trying to move right away from — this idea that we are going to become a media ‘player’.”
Telecom New Zealand says it already has a similar plan to that offered by AAPT in its Big Time product, which offers unlimited data and no overage charges, but with network management applied, especially to file sharing and online gaming
According to Broad, it was the larger telcos such as Telstra, rather the smaller, nimbler players, which were likely to view content as a significant source of revenue.
“Telstra, with its 50 percent stake in Foxtel and Sensis business, has a lot of things under its control well beyond its traditional telco business which it can utilise and leverage off its own network,” he said. “Telstra is in a wonderful position to capture that value, but it won’t be as profitable as the old PSTN revenue. You’d have to sell twice as much content to make half as much revenue.
“Because we’re smaller and more agile and have to go up against Telstra, we’re trying to create a different part of the market and partner with others to remain competitive. We’re not trying to pitch ourselves as all things to all people, whereas Telstra is."
According to Broad the timing of the 24/7 unlimited broadband offering was not related to flow-on of the recent iiNet court case — in effect, that ISPs are not responsible for the illegal downloading of content by their customers.
Instead, AAPT had been testing the waters of unlimited consumer broadband for some time through its unlimited 8pm till 8am offering, and was now confident of its capacity to handle the additional daytime traffic over its network.
“We did it as a progressive thing to make sure we could deliver on in it; there’s nothing particularly magic about the timing,” he said. “We wanted to make sure we had the capacity, and it was tested, and we had figured out how to manage it if some people sought to abuse it.
“When you have a network as large as ours, and you take something as significant as [24/7 unlimited broadband] on, you want to make sure you get it right.”
Despite being ‘unlimited’, Broad said AAPT would apply a fair use policy to the offering in order to minimise both abuse of the network and the illegal downloading of content.
“There is a fair use policy,” he said. “If someone tries to run BHP on something like this, then they won’t be able to. But for consumers, there is only about one half of one per cent with which you have an issue.”
Broad said as a result of offering 24/7 unlimited broadband, smaller ISPs could increasingly move toward similar offerings, however they would be under increasing pressure to partner with an infrastructure provider to do so.
“It could be the NBN, or partner with us, but that’s why you see TPG getting into PIPE,” he said. “It’s all about leveraging infrastructure to remain competitive in the consumer space. iiNet and Internode have bits of it, but it’s all about how you put it all together.”