Rivals slam RBI decision favouring Telecom/Vodafone

Decision will make it difficult for Taitokerau's proposed Northland fibre network, says Torotoro Waea spokesman

The other bidders for the Rural Broadband Initiative say they don’t know the basis of the decision to award the tender to Telecom/Vodafone and that they can’t see where the proposed copper/3G proposal can be superior.

“They say they’re going to a proven technology with copper – it’s so proven that it’s being replaced by fibre everywhere," says Kordia ceo Geoff Hunt.

“The opportunity to deploy much better broadband has been lost. It is really disappointing," he claims. "New Zealand had an opportunity to invest in 4G technology, which is where Australia and China are going. We’re really disappointed.”

He claims the decision effectively condemns rural communities to suffering from same old duopoly services that continue to under-deliver and hold rural New Zealand hostage. “The government had an opportunity through the RBI to provide a technology step-change in services for rural New Zealand that would have laid a future-proof and highly competitive foundation for the next 15 years. “We should remember that this was supposed to be the rural broadband initiative and not the rural mobile initiative.” Hunt claims Telecom’s copper has been rejected for urban New Zealand and performs even more poorly in rural environments. “The 3G element of the Telecom /Vodafone solution is being superseded all around the world by fourth-generation wireless (4G) technologies like TD-LT, OpenGate’s proposed technology solution for the RBI. “Australia, India, China and the US are all planning to roll out this technology now, and between them will have more than one billion customers. We thought this would have been a compelling sign for New Zealand if the Government wanted to keep in-step with its key trading partners. Alas, no.’ “Telecom is also in contract negotiations to deliver Ultra-Fast Broadband, which requires them to deliver up to 100 Mbps in urban areas. Rural access to up to 5 Mbps will hardly close the digital divide,” Hunt says . “Without competition, it is hard to see this duopoly doing anything other than rolling out the minimum requirement of 5 Mbps over six years. Urban users in the same timeframe will have access to 100 Mbps," he claims. “Vodafone and Telecom do not currently own the spectrum required to roll out 4G and will not be able to access it until 2014 – assuming they are successful in the auction process,' he claims. Telecommunications consultant Ernie Newman says any upgrade path promised by Vodafone and Telecom is hypothetical, as it can only follow the 700 MHz spectrum auctions that are planned some time before 2014. “Vodafone will have to compete with other parties to buy spectrum, so unless the government has accepted their bid conditionally on the outcome of the spectrum auction, or plans to alter the auction process accordingly, delivery of any promised upgrade is not a certainty by any means.” FX Networks managing director Murray Jurgeleit says the OpenGate consortium believed it had offered a solution that “way exceeded” the criteria.

“We’re still not sure where copper and 3G can be superior. It seems that it was in the wireless area that the Telecom/Vodafone solution was regarded as better," he believes.

“It’s certainly going to be harder to get competition now. We will offer competition but not as broadly as we might have.

“We’ll continue to work with the unsuccessful bidders to extend our network.”

More difficult for Taitokerau network

Torotoro Waea spokesman Antony Royal says the decision is disappointing.

“History tells us that Telecom and Vodafone are not really interested in New Zealand," he claims. "I’m not convinced that they will deliver, though we would welcome discussions with them.”

Royal says the decision will also make it more difficult for the Taitokerau network, announced last week

A consortium of Northland (Taitokerau) iwi is constructing a high-speed broadband infrastructure network for the Northland region that will operate as Taitokerau Networks.

The project is being managed by a strategic equity partner and telecommunications operator, Datalight Ltd – the company that leads the OPTO Consortium and is also acting as general partner for Torotoro Waiea.

A spokesman for the iwi consortium, Haami Piripi, chair of Te Runanga o Te Rarawa, says the business model is designed to stimulate Northland’s regional economy, and in particular, Maori communities.

“We have designed the model to ensure there are returns to cover our costs and that will also enable an adequate level of profit to reinvest in our communities.”

He says a number of jobs have already been created to develop the network, and it is expected that Taitokerau Networks will influence the creation of a significant number of jobs across the Northland region over time.

Roger MacDonald of DataLight, says final agreements are being drawn up between iwi, industry, local and international funders to build, operate, maintain and govern Taitokerau Networks’ initial fibre optic transmission network infrastructure from Auckland to Whangarei.

Construction is due to commence this month and will be completed in five months at an estimated $9 million.

The network will be the first iwi-owned regional transmission and backhaul network in the country.

“It’s a commercial cable with a huge amount of capacity," says MacDonald. "But the interesting thing about the cable is it’s specifically built for rural access. So unlike the current cables which go up and down the country, what they’ve done is to analyse every farm, every marae, every health outlet, every school and they’ve put connection points along the main cable. So they break specific fibres out to feed access points."

He says the access points will be located about every two to four kilometres along the cable. “It makes it very easy for a farmer, or a marae or a school or anyone in the rural communities to connect in between cities. If you go around the country its very difficult for rural people to connect to a major backbone, they just can’t cut into it.”

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