The Internet Group has confirmed its intention to resell ADSL services when Telecom makes them available this year, but has raised some questions about the pricing and viability of the service.
Ihug director Tim Wood says the company has been shown Telecom's basic pricing, "but we haven't really negotiated what our price might be". ADSL charging will be volume-based, with pricing based on a monthly threshold.
The extra international bandwidth sucked up on high-speed DSL Internet connections is likely to be the major cost involved in providing the connectivity and Wood says that fact should be recognised by Telecom.
"I've got some concerns about the way it's being charged. I think they need to exclude local content, so that it doesn't count as part of your monthly volume limit. New Zealand RealAudio stuff for instance should really be separated out from international traffic, or it'll really limit the way people use high-speed services."
Wood believes ADSL "will be a great product for CBD businesses" and it is likely to be integrated into Ihug's StarNet-based VIPNet business offering.
"But I don't know if it's really going to be great for residential use, pricewise. There's also a lot of low-grade copper wiring in parts of Auckland like Ponsonby and Grey Lynn - I wonder how you can quantify charging two people who might live in the same street but will effectively get different products depending on the state of the copper. It's not really a blanket service, which makes it hard for them to market."
Wood is welcoming the prospect of ADSL as a way of expanding the overall high-speed access market, which he believes will be a key one on the next few tears. Ihug has just launched a revamped StarNet service based on new PCI cards able to handle data volumes of up to 20Mbit/s - although throughput will be limited well below for the time being.
Wood says the company is also working on offering better bandwidth over the return path back to the ISP "whether that's using traditional methods or wireless."