50Mbit/s to the home? No problem say network builders

The Ministry of Economic Development's draft discussion paper on New Zealand's broadband future paints a rosy picture of 50Mbit/s to most homes by the end of the decade. But given the government's rejection of unbundling of Telecom's network, just how feasible is that goal?

The Ministry of Economic Development's draft discussion paper on New Zealand's broadband future paints a rosy picture of 50Mbit/s to most homes by the end of the decade.

But given the government's rejection of unbundling of Telecom's network, just how feasible is that goal?

Auckland-based electricity provider Counties Power's CEO Neil Simmonds believes it's not only possible by 2010 but could be rolled out much sooner.

"When I first read that I said 'Yeah, sure'. But now I'm thinking 'Yeah! Sure!'." Simmonds says his busiest customer, a business in the district, used 80GB in five days.

"On our fibre network it's possible today, but really, what would you do with it all?"

Simmonds is sceptical about using broadband for delivery of television signal, saying TV already has a great delivery mechanism.

"Sky already delivers dozens of channels digitally today so why would we reinvent that wheel?"

Having said that, Simmonds says building a network that could deliver 50Mbit/s to the suburban user isn't all that astounding.

"VDSL is capable of that kind of speed right now, although over only about 400m. But 400m in suburbia is quite a long way."

VDSL, one of the new variations on the DSL theme, offers much higher traffic capacity than Telecom's current DSL model but over a much shorter distance.

Telecom's DSL product JetStream is usable to around 4km from the exchange.

"So you'd have to build fibre out much further into the market than it's currently deployed and run something else from there to the home."

That "something else" could conceivably be VDSL, wireless transmission or even powerline capacity, something Simmonds says Counties Power has given a lot of thought to.

"We've said it's quite workable but we wouldn't look at it until we needed to. For this kind of service it would work just as well as VDSL."

Wellington-based fibre network CityLink's managing director Neil de Wit is equally upbeat about the goal.

"The question isn't 'can we do it' but 'what happens if we don't?' "

De Wit says the levels of service are feasible but it would require a clear objective.

"Who are the investors to be, who will the service cover, who needs the service and what happens if it fails?"

De Wit believes the consumer will pay one way or another "whether it's directly through ISP charges or indirectly through rates" but that's just what happens when a service becomes a utility.

"It'll be just like roads or water."

CallPlus founder Malcolm Dick is less optimistic for the future following the government's decision not to unbundle Telecom's network.

"Really, who else will do it? Most New Zealanders don't realise just what a profound effect broadband will have on the economy as a whole, and for the next decade we've put that power in the hands of one company."

Dick says Telecom is mostly owned by foreign investors who do not have a "social conscience" for what happens in New Zealand.

"Telecom is talking up its new dividend policy, it's not going to spend any more than it has to in order to defend its turf. Why would it? Nobody else is in a position to compete and won't be for years to come."

Dick believes unbundling would deliver the user numbers to encourage the incumbent to build a network capable of delivering such speeds but that without it the time frame for such a development will blow out.

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