Just finished a most enjoyable and stimulating three days at Vodafone, organised by the Business Parliamentary Trust. This gives MPs the chance to parachute into a business and get some insights.
Vodafone is a very different corporate workplace than anything I’d experienced. Entirely open plan and very informal, right down to CEO Russell Stanners who sits in jeans in the corner of the office at something akin to a bar leaner!
Major revelation? Vodafone queries whether the spending of $1.5b on an urban broadband fibre to the home rollout should be top priority right now if boosting productivity is the main objective. Its views are that fibre backhaul, international connectivity and rural broadband should be the focus in the short term at least, with ADSL and VDSL technology being capable of delivering what most urban Kiwis will need in the short term. Vodafone’s estimate is that by 2011 80 percent of Kiwis will have 10mbs broadband via DSL which is the entry level to real broadband.
This is quite an heretical view for me. I did some work for CityLink in my past life and remain a member of InternetNZ. But here’s Vodafone’s analysis. Yes, fibre to the home would vastly boost speeds and yes in time it will be needed. But fibre to the home costs a fortune and for a cash-strapped government backhaul and international connectivity might be higher priorities. . And given a choice of having 10mbs – and improving with technology at a lower cost or fibre with 100Mbps + speeds for a higher price – a key underlying question is will Kiwis sign up in sufficient numbers to make the Government-subsidised fibre connection arrangements viable?
In essence it seems Vodafone believes the Government would be better to put any money into improving rural broadband, where cabinets are rare and distance from cabinets sap bandwidth delivered over copper. A somewhat self-serving view perhaps as wireless is a strong option to provide rural broadband and that’s where Vodafone has its strength. It suggests that in two years, up to 100Mbps will be available over wireless across New Zealand, with constant minimum speeds of perhaps 25Mbps. And, Vodafone along with other telcos is being whacked by Stephen Joyce for a $300m “telecommunications development” levy towards funding rural broadband after Federated Farmers protested at the original paltry $48m that he suggested might be spent on rural delivery. Vodafone supports fibre backhaul and fibre international connectivity improvements. I do find it interesting that Vodafone aren’t backing immediate fibre to the home rollout. If it could access the fibre at low enough regulated prices this would seem to provide a better platform for it to grow into its redefined ambitions to be a landline AND mobile company; fibre to the home would seem to provide it with a better platform to compete than continuing to be reliant on access to Telecom’s copper wire network. I am sure these views will be challenged by some in the techie and broadband community, not to mention Government. I await that rollout.
Wasn’t all of this obvious? It beggars belief that Labour has never attacked the scheme – preferring to oddly attack Telecom over it.
there is no way anyone can argue broadband is the highest priority if we are looking for projects to inject $1.5 billion into.
But fibre to the home costs a fortune and for a cash-strapped government….
Why don’t you get stuck into them about chasing that 2 billion dollars from those thieving banks. It would completely pay for this and other services like this.
Akldnut you miss the point. It’s not about who you can find money from to fund whatever pie in the sky schemes you can think of, it’s about making sure that the schemes make sense and will deliver real benefit to New Zealand.
The Government’s scheme simply does not make sense. And it’s costing us $1.5 billion dollars.
Labour has not had any serious criticism (that I’ve seen, and I do keep an eye out!) of some the scheme, which is riddled by very fundamental flaws and is letting the Government get away with murder. Not cool at all.
“Vodafone’s estimate is that by 2011 80 percent of Kiwis will have 10mbs broadband via DSL”
I think you should check with David Cunliffe before posting again – that isn’t ‘Vodafone’s estimate’ it is the commitment Cunliffe agreed with Telecom through the seperation process.
ie what you think is Vodafone’s estimate is actually an achievement of your party…
And yeah, why has Labour not attacked this fund?
I blogged this not to advocate Vodafone’s views or attack the Govt’s $1.5b spend but because it seemed out of whack with what I wd have expected. Here’s Telecom’s rival saying Telecom’s roll-out of fibre to the node and cabinetisation shd deliver most of what urbanites want/expect/will pay for; and that maybe there are better priorities for broadband spend. Good to see some debate ensuing.
well yeah – that’s why Labour reached that agreement with Telecom in the first place. And it isnt costing the taxpayer a cent as the private sector is funding it.
Unlike National’s plan which will see us spend $1.5 billion on a luxury in incredibly tight economic times. I cant see why you wouldn’t want to attack dumb policy like that.
So I assume Vodafone put forward their own proposal? Or are they merely sitting back and criticising?
Vodaphone must be rapt to have an MP spouting its position on the broadband spend.
Meanwhile, I note, the company is heading into court to face Commerce Commision charges for lying to and ripping off New Zealand customers. Did super-cool, informal Russell Stanners have anything to say about that?
Off-topic, I know, but to be fair to Vodaphone, the Commerce Commision has also issued notice of a High Court prosecution against Telecom.
My main point is that the major players in the telecommunications and broadband area are a bunch of rogues. If New Zealand wants top quality broadband then it would be better off if the entire industry were nationalised and the infrastructure considered an essential element to the national economy and not the plaything of international corporates. The same thing applies with electricity.
Blip, I’m not here as a mouthpiece for Vodafone but clearly you and others find the information useful
You’ll note that what Brendon is saying isn’t just inline with Vodafone’s views, but Paul Reynolds seems to agree.
Why on earth is the Government spending $1.5B to compete AGAINST established fibre networks? The National Party are flushing a huge amount of New Zealand’s money down the drain – Muldoon would be proud.
There is a lot that the Government could be doing on broadband that would have a far greater impact for far less money.
Sigh.