OECD broadband numbers: the good, the bad and the ugly

Cunliffe says he's pleased but promises to 'keep a close eye' on stats

The Government and Telecom both say they're pleased with the OECD's newly announced broadband rates for the year to December 2004, claiming broadband penetration in New Zealand has increased by more than 80% over the previous year.

The OECD figures relate to growth in calendar year 2004 and have New Zealand's ranking static at 22 out of 30 countries. Broadband penetration in New Zealand is reported to be 4.7 subscribers per 100 inhabitants. Australia sits one place above New Zealand, but has 7.7 subscribers per 100. Top of the table South Korea has 24.9 subscribers for every 100 inhabitants.

Telecom's general manager for government and industry relations, Bruce Parkes, says New Zealand's uptake rate is almost double the OECD average.

"If we continue to grow at that rate then obviously we're going to start catching up with the OECD."

However, the OECD report includes a weighted comparison of the net increase of penetration rates which does not reflect well on New Zealand. Instead of increasing broadband numbers at twice the OECD rate, the net increase is less than the average: only 2.18 new connections per 100 inhabitants as opposed to the OECD average of almost three connections per 100 inhabitants. Australia, in contrast, has a net increase of 4.25 per 100.

The Minister for Communications, David Cunliffe, says while it's a good start, there's a lot more work needed to meet the goals he has set for New Zealand's ICT sector.

"I've said it before and I'll say it again now: broadband has to cost less and deliver faster speeds."

Both Cunliffe and Parkes say they expect the 2005 results to be better than last year.

Parkes says the OECD's latest figures include only a month or so of the new wholesale regime, and that each quarter since the end of last year has seen record growth.

"It's going gang-busters and I strongly suspect that this year we will be well ahead of [the OECD average] again." Parkes says the last quarter of 2004 saw broadband sales grow at 40% more than the third quarter of 2004.

Cunliffe says Telecom is clearly on track to meet its goal of 250,000 broadband customers by the end of the year, but is somewhat less certain about the other goal of delivering 30% of its customers through the wholesale regime.

"I will be keeping a close eye on those figures but we won't be revisiting the issue of unbundling or anything else until Telecom has had a chance to prove itself over the year."

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