Forum: For telecomms buyers, there is reason to be hopeful

Change really is in the air

The good news in telecommunications keeps getting better. On Wednesday, Vodafone will announce a $50 million investment in LLU, rolling out DSLAMs into Telecom’s exchanges and probably offering VDSL to some customers from the day of launch, expected some time later in the year.

Orcon is similarly rolling out DSLAMs and so are several other providers.

All of that is the direct result of the new regulatory environment we now find ourselves in and throws into stark relief how quickly progress can be made when you don’t allow incumbent monopolies to lord it over issues of national interest.

It would be very hard indeed for anyone to argue that the market alone would have taken us where we are now heading.

That said, Telecom is and will remain the most important private player in the game for some time to come. There is a fresh wind blowing through there as well with an almost complete replacement of key executives from the old regime now evident.

Markets, quite rightly, remain at the core of service development and delivery and there are ever more signs that those market mechanisms are starting to work the way they should have in the first place.

More good news for users came out of Vodafone’s preliminary annual results, posted on the parent company’s website last week. New Zealand mobile phone users, or at least Vodafone users, are both using their phones more and paying less on average for what they use.

With the never ending wait for the arrival of a third mobile player seemingly about to end, the mobile market will become even more competitive.

It really does look as if New Zealand is on the cusp of achieving what just a few years ago would have seemed almost impossible — a vibrant, multifaceted and competitive telecommunications market.

But before we get all carried away, there is still a lot of work to do. Both National and Labour have promised significant investments in broadband, with National emphasising a broad fibre rollout and Labour effectively boosting its Broadband Challenge concept to deliver a more targetted and technology neutral rollout.

Labour’s plan, based on funding open-access networks, keeps the heat on the free market to deliver quality service and quality prices. There is still some detail to be seen out of National, but there is no doubt if it follows through on its commitment it could be transformational.

Either way it’s good, but we do have to be careful not to undo the very good work of the last few years.

New Zealand isn’t exactly leaping up the OECD ranks, but it is slowly getting there and there is every chance that as these new service rollouts continue that progress will accelerate.

With a change of government possible, or even likely, there are plenty of signs that Labour is trying to lock in its legacy. While in some areas that might be a matter of debate or concern, that is not the case in telecommunications. We are all better off in this new world than we were before.

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