Vector to swallow UnitedNetworks ethernet service

UnitedNetworks Communications, the telecommunications subsidiary of utilities company UnitedNetworks, will compliment new owner Vector's existing broadband telco offering, Tangent in the main centres.

UnitedNetworks Communications, the telco subsidiary of utilities company UnitedNetworks, will compliment new owner Vector's existing broadband offering in the main centres.

UnitedNetworks Communications and Vector's offshoot, Tangent, were both started by their parent companies using existing infrastructure, thus saving the cost of a network rollout from scratch. UnitedNetworks runs its fibre through gas pipe lines while Tangent fibre is laid alongside Vector's power lines.

Tangent's network covers 950 square kilometres from the Auckland CBD to Manukau and on to Papakura.

UnitedNetworks has already rolled out fibre in both Auckland and Wellington CBDs and when combined will allow Vector to boost its new role as broadband network provider in the country's two main business centres.

UnitedNetworks put itself up for sale earlier this year at the behest of its US-based parent Aquila and has accepted a bid from Vector, which will involve Vector buying most of UnitedNetworks' assets.

(UnitedNetworks' shareholders need to approve plans to dispose of some assets to interests other than Vector and Aquila's bankers need to give their consent to the deal before it can go ahead).

The UnitedNetworks Communications networks Vector will acquire can operate at up to 2.5Gbit/s and can be scaled up for newly-approved 10 gigabit ethernet, though there is no indication of demand for that yet.

Earlier this year, Tangent general manager Jill Garing told Computerworld Tangent is running services between 2Mbit/s and 1Gbit/s, with the capacity to go up to 2Gbit/s.

Last month, the Commerce Commission gave its approval to the takeover but Vector is declining to comment further, given the pending shareholder vote.

Neil de Wit, managing director of Wellington metropolitan ethernet network operator CityLink, also declined to comment.

"It's too early in the piece."

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