Telecom/Vodafone bid wins rural broadband tender

Government encourages unsuccessful rivals to work with telcos

ICT Minister Steven Joyce has announed that the government will negotiate with Telecom and Vodafone for the provision of rural broadband throughout New Zealand.

Joyce says the joint Vodafone/Telecom proposal is based on proven existing technology, and provides the government with confidence that it can be deployed. “The government specifically asked for parties to consider collaborating on joint bids to reduce construction costs – and this bid does just that.”

“Currently 20 percent of customers in rural New Zealand can access speeds of at least 5 Mbps. This will rise to 86 percent of rural households and businesses, with 95 percent of rural schools receiving ultra-fast connection. The extension of the fibre backbone into rural areas means more customers living on the fibre routes may be able to get fibre-to-the-door.”

The joint bid involves an extension of Telecom’s fibre network to deliver fixed wireless and fixed wire broadband to 252,000 customers in rural New Zealand, and the construction of 154 fibre-connected cell phone towers to enable fixed wireless broadband to rural customers as well as improved mobile coverage, and the direct connection of 719 rural schools to fibre networks, the Minister's statement reads.

“The joint proposal was the only one that increases mobile coverage, and it will ensure serious competition in the last mile with many rural customers being able to choose from fixed wireless, ADSL2+ and mobile broadband.”

Negotiations for the $285million contract will be undertaken over the first quarter of 2011 with the roll out due for completion by 2016.

Joyce says unsuccessful tender parties are also now encouraged to start working with Telecom and Vodafone to look at ways to further improve solutions for rural New Zealand.

In December three bids were shortlisted for the RBI. In addition to the Telecom/Vodafone proposal there was the OpenGate alliance of Kordia, Woosh and FX Networks and a Maori consortium Torotoro Waea. Last week OpenGate expressed concern over media and analyst speculation that the Telecom/Vodafone bid was the frontrunner.

UPDATED Thurs10 Feb: Devil’s in the detail when comparing RBI bids; We look at Telecom/Vodafone and OpenGate proposals

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Tags VodafoneRBItelecomRural Broadband InitiativeSteven Joyce

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