Vodafone on Rural Broadband

November 26th, 2010 at 12:00 pm by David Farrar

A guest post by Steve Rieger, ’s General Manager of Wholesale and New Business Development:

Rural – an easy answer

The Telecom-Vodafone joint bid for the Government’s Rural Broadband Initiative (RBI) has certainly got attention.  Who would have thought that these traditional arch enemies would entertain such a partnership?  Well, it’s the right thing to do to deliver a step change in connectivity for New Zealand’s rural community and moreover we think it’s the way of the future.

We think rural Kiwis deserve high speed broadband, wider mobile coverage and a choice of service provider.  That shouldn’t just be the preserve of the city-dwellers.  That’s why our solution – a new open-access network which combines fibre and wireless gives better bang for the tax-payer’s buck.  It equips New Zealand’s economic heartland, which accounts for 60 percent of New Zealand’s exports, for the 21st century.

So what will we deliver?  Fibre to 97 percent of rural schools and a minimum of 5Mbps broadband service to 80 percent of rural households within six years and priority users with fibre-based broadband services.  That’s a minimum of 5Mbps.  In time we will deliver more.  And, we will deliver it faster than the government’s timetable.

The solution looks like this: Chorus will extend Telecom’s existing fibre infrastructure to key rural points of presence, including schools and hospitals.  Vodafone will expand its wireless infrastructure to deliver wireless high speed broadband.  Chorus will build the fibre and DSL network and Vodafone will build the mobile towers.  XT and Vodafone will put their cellular equipment on the towers and provide independent services to their wholesale and MVNO customers as well as directly to retail customers.

The key is open access.  Anyone will be able to offer a retail service over the new infrastructure, whether fibre or wireless, on an equivalent basis.  2degrees, XT and regional wifi operators will be able to put their equipment on the towers and provide independent services to their customers, competing on equal terms.  The result – strong retail competition and a real choice of retail solutions and providers for rural customers.

We think this model is the new state of the telecommunications industry.  We compete vigorously on one hand and cooperate on the other.  The design of this solution means we will continue to be fierce retail competitors – and have created a platform that enables other operators to compete with us.  Trying to deliver this as a sole operator just doesn’t stack up economically.

Our proposed solution delivers choice to rural customers: either fixed broadband, or fixed wireless broadband.  In delivering wireless broadband we provide additional social advantages by enabling wider use of mobile voice and text, two important communication channels for individuals and communities.

Why not fibre to the farm? The economics just don’t stack up.  International best practice for rural communities is to deliver broadband over wireless networks.  Ireland, Germany, the US and Australia have all gone this way.  It means rural families can stay connected at home and on the farm, reducing geographical and social isolation.

Wireless is also future-proofed.  It means next generation mobile technologies such as 4G (otherwise known as Long Term Evolution – LTE), can be rolled out to rural users at the same time it’s made available to urban customers.  4G will offer faster data rates, lower latency, shorter delays and loading times, and ultimately a better experience.

Vodafone and Telecom can bridge the urban/rural digital divide in New Zealand, give other players equal access to the infrastructure, and deliver choice to rural New Zealand.

The Minister expects to make a decision by Christmas.

I am a big fan of the open access nature of the proposal, and think it is a model for future mobile expansion.

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10 Responses to “Vodafone on Rural Broadband”

  1. Jimbob (640 comments) says:

    Sounds promising.

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  2. pmofnz (66 comments) says:

    I would not trust Vf Wireless for the rural masses. I’ve been on their wireless for 3 years or so. Telecom dial up remains the only other reasonably priced option here. Vf wireless suffers from endless disconnects, poor dns resolution upon connection to their network and very slow downloads. (Telecom wireless round these parts is non-existent) All with an exorbitantly charged Vf data cap and absolutely useless help service (they do not answer support emails in a business week, sometimes weeks – the alternative is to ring and joined the queue of the damned). Yes, Vf you will have to do a hell of lot better. VOIP on wireless? I”l believe it when it has been place for a couple of years. For those of you considering changing, you have been warned.

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  3. infused (634 comments) says:

    min of 5mbps. hmm, in 6 years… nah that’s slow.

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  4. pollywog (1,153 comments) says:

    choice is one thing but is it going to bring the price down or push it up ?

    as it is it’s virtually unaffordable for rural wannabe customers to buy any significant gigabytage without paying through the nose for it.

    on the upside, there could be quite a bit of work for an ex coms rigger and all round monkeyboy like myself :)

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  5. RAS (62 comments) says:

    “Who would have thought that these traditional arch enemies would entertain such a partnership?”
    Gee I dunno, maybe everyone in NZ who are shafted by their cosy little cartel with crap speeds and high prices. They’ll still control the base price no matter who your retail company is.

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  6. Bed Rater (239 comments) says:

    What’s the current rate for an advertorial on kiwiblog these days?

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  7. David Farrar (1,853 comments) says:

    Politeness

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  8. GT (44 comments) says:

    Vodafone can’t even deliver decent 3G and voice in Christchurch, they don’t have any hope of delivering a decent rural service…

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  9. Tauhei Notts (1,601 comments) says:

    I have mentioned this before, but cow cockies from Tauhei have told me that they can get quicker access to Fonterra’s site from a cyber cafe in Prague, than they can from their home computer in Tauhei. It pisses the sharemilker off, big time, when they e mail from Europe that last night’s milk collection was not up to what they were expecting.

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  10. orewa1 (428 comments) says:

    Bizare, in several ways.

    First, that anyone would seriously suggest 5Mbps is within the proverbial country mile of future-proofing NZ’s rural users, schools especially. Lets get real.

    Second, that cellular technology could be seriously proposed as having anything like the capacity required for rural NZs broadband needs. Using cellular technology with all the attendant limitations of speed and capacity, is about as sensible as closing down the shipping ports and using B747 freighters to export logs!

    Third, that the desire of the dominant cellular duopolists to share infrastructure costs (which has some merit) could be confused with a viable response to the desire of the rural community to access broadband at city-style speeds, and the government/taxpayer to subsidise this. Why on earth should taxpayers front up to subsidise an upgrade of cell sites that the two networks need to do anyway to stay in business?

    And fourth, that Kiwiblog would give Vodafone a free “guset editorial.” I’ve been reading this blog for a number of years and I struggle to recall when a commercial vendor has been allowed a guest blog to promote a competitive tender that is still under consideration.

    DPF – are you willing to allow the same exposure to any of the other 4 tenderers if they wish?

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