Fencepost net excites interest

Fonterra is keeping mum on who wants to be a partner in online subsidiary Fencepost's planned rural telco network, except to say the interested parties "all have a presence in New Zealand".

Fonterra is keeping mum on who wants to be a partner in online subsidiary Fencepost’s planned rural telco network, except to say the interested parties “all have a presence in New Zealand”.

By last Monday Fonterra had received “a fair few” expressions of interest in response to newspaper ads, including some from overseas, says Fencepost acting head Mike Ryan. “Some of them are people I’d never heard of.”

Fencepost will work with five original bidders — who have been in discussions with the organisation for some time — to get their proposals “up to another level” and invite a shortlist to make more detailed proposals. The successful bidder will be decided later this year.

Requirements include the ability to get the service up and running within a year at 64kbit/s, with the capability to scale up to higher speeds after that and the ability to offer a package which includes more than just data, potentially involving voice and video.

Walker Wireless chief executive Bob Smith wouldn’t comment on whether Walker was one of the five, saying “it’s up to Fonterra to comment”.

He did say that the company, which is trialling new wireless technology, is keen to talk to community groups in rural and provincial areas about providing broadband access. The idea of a wireless rural broadband network to compete with Telecom’s copper-based services in that market is “extremely viable”, he says. Rural internet users aren’t well served at present, he says. “[Telecom’s copper network] was never built for broadband — the distances from exchange to exchange make it very difficult.”

Telecom spokeswoman Linda Sanders doubts the viability of setting up a network to service Fonterra’s shareholding dairy farmers from Northland to Bluff.

“I don’t think [Fonterra] are talking about a network per se — I don’t think anyone has the capability to do it.” Rather, she sees different technologies being deployed in different places depending on the circumstances.

Fencepost’s advertisement, however, says it is looking for providers able to initially offer 64kbit/s data services “for all Fonterra dairy farmers and almost all other rural dwellers”. Its proposal also requires the partner to come up with the cash for the investment, though Ryan says the companies are uncommitted at present on how the enterprise will be funded. “It depends entirely on the partner and the type of operation we set up.”

If the proposals are based on wireless, Sanders notes adverse weather can affect such services and that electric fence interference, users’ modems and inference from Sky Television transmission can all affect rural internet services.

Fencepost is a Telecom client and the two companies continue to talk about services to the rural sector, she says. CDMA, Telecom’s new mobile technology, is being tested to see whether it would be a suitable replacement for the more limited multi-access radio, Telecom’s fixed radio system used in areas where cables can’t be laid. “Multi-access radio ... is designed for voice only and we’ve been looking in a couple of places to see whether it’s a viable alternative.”

Ihug director Tim Wood says the ISP has an existing relationship with Fencepost and fellow Fonterra online arm RD1 through which it promotes its Ultra satellite high-speed internet service.

The rural telco proposal is “broader” than Ultra, but Ihug was planning to put in an expression of interest, Wood says.

Other possible contenders include BCL, TVNZ’s transmission arm, which has a nationwide chain of transmission towers, though that may be in cooperation with another provider, as Lawson told Computerworld last year that BCL is “a wholesaler, a carriers’ carrier”.

Vodafone wasn’t one of the original five, spokesperson Sarah McGovern said last week. However, she told Computerworld the company was looking at putting in a proposal as part of a second pool of applicants despite the “quite short” deadline — January 18.

Fonterra, the cooperative entity resulting from the merger of New Zealand’s biggest dairy companies and the former Dairy Board, has approximately 13,000 farmer-shareholders.

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