2001 Conference - Rotorua

Infrastructure - Getting the Best from What You've Got

John Goulter
Government Relations Manager
Telecom New Zealand Ltd

Telecom and Regional Development

Telecom is New Zealand's nationwide telecommunications provider.
Our customers live in every part of New Zealand - it's our job to keep them connected.
We share the Government's regional development vision - it's good for our customers.
As the country's leading telecommunications infrastructure provider, it is a core part of Telecom's `triple bottom line' to help regions cross the digital divide.

JetStream and JetStart are Telecom's broadband products, delivering fast connectivity using copper-wire and Asymmetrical Digital Subscriber Line (ADSL) technology.
DSL is global benchmark standard for broadband.904,000 residential customers, or 62%, can access JetStream, 296,000 business customers or 77%. Broadband can reach 1.2 million. 24,000 have got connected.
50 times faster than dial-up Internet
Compared with other countries in the OECD New Zealand has

lowest cost DSL-based Internet service (JetStart residential service)
fastest DSL-based service
best value for money, given initial and monthly charge and bandwidth available
More coverage than the United States, Australia and Britain
Time in Market - taking into account time in market, New Zealand's pace of adoption of broadband is rapid

The challenge now is getting broadband beyond the main centres and into the regions.

At 62% residential coverage, broadband has been delivered to all the areas where it was possible to make a strong, compelling business case.
After a long internal debate about whether to pause at the current level or find a way forward, Telecom this year decided to embark on a new approach - community partnerships.
If you can show there's a local demand, and we have a fibre backbone to the area, we want to talk. (Where we don't currently have the fibre backbone, it's a much tougher proposal).
Telecom still needs to be convinced a business case stacks up, but our experience in Otago and elsewhere has shown us that local groups can make that a lot easier - and get broadband.

All utility providers face those issues - broadband is no different.
Once there's a local realisation of those factors, we can get into a win-win solution that works for us both.
With a local contribution - and a commitment to make it work - we can offer the same pricing structure as in the urban areas. Without it we couldn't.

A realistic assessment of demand
Why do you want broadband? What do you plan to do with it, and how can we add the most value? Bandwidth is nothing - let's talk about what we can do with it
Foundation customers - schools, leading businesses, local authorities, government agencies, Fonterra
A local infrastructure - a network of advocates is far more important than a network of copper
A strong local driver - we can supply the "pipeline" but only people on the ground can make it a force for regional growth
A local source of funding such as a trust

The Community Trust of Otago selected Telecom as partner to lead Otago on-line.
The initiative will see every secondary school in the region able to get broadband.
The Trust facilitated the introduction of broadband in 13 Otago towns after receiving detailed proposals from two suppliers.
Turnaround time about 4 months from start of talks to broadband going live on 1 December.
The initiative will see schools in smaller centres joining together to share resources through a Virtual Private Network and a "virtual classroom" teleconferencing facility.
Upgrading the exchanges to deliver broadband to the secondary schools means fast connectivity can be offered to others in the community - up to 7km from exchange.
Building on the Otago experience, Telecom has developed a broadband template we're taking to other regions.
Communities underwrite a portion of the install costs - sharing the risk.
Under a formula agreed in advance, the communities' contribution is refunded once demand has reached certain levels.

Where Telecom enters community partnerships to deliver broadband, we are working on a model to offer schools access to a Virtual Private Network, offering a flat monthly fee for an "all-you-can-eat" service for the schools.
Schools can get on-line, fast speed internet access, video conferencing and a nationwide school network, removing the disadvantage that regional children suffer.
Small businesses can conduct on-line e-commerce with every customer in the country - and the world - putting them on a level playing field with their city competitors.
Regional and rural communities have the same Internet capability as Wadestown and Merivale.

The ADSL technology that delivers broadband is not appropriate for hard to reach areas that are distant from exchanges, or whose exchanges lack the infrastructure.
A Telecom project team is working with potential partners and other technologies to find affordable solutions. This would likely be some form of wireless solution. CDMA is offering increasingly good prospects.
Telecom has considerable experience in wireless and satellite solutions and holds extensive wireless spectrum rights and a national network of hilltop sites.
The technology is changing fast but our assessment of the technical and commercial reality of alternative networks is that they are 2-3 years away, and the cost structure is likely to be higher than ADSL.

Telecom's community partnerships show Telecom is serious about working with communities to deliver broadband to areas that would not normally receive it.
Telecom wants to constructively engage with communities to find opportunities for working together to speed up the delivery of fast Internet connectivity to regions throughout New Zealand.
We can bring experience and other community groups' learning and involvement.
We can move fast.

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Date Last Modified: 2005-01-25