Plan for broadband network challenged

A war of words has broken out over the Dunedin City Council's plan for a new multimillion-dollar fibre broadband network to be owned by the community.

Details of the scheme were announced yesterday by council-owned electricity lines company Aurora Energy Ltd, which has applied for a $3 million share of the Government's $340 million Broadband Investment Fund to help pay for the network.

The 39km "municipal fibre network" - to be known as the Flute network - would be owned by Aurora and link Dunedin's municipal buildings, key businesses, schools, the University of Otago and Dunedin Hospital.

However, Telecom is already spending millions upgrading its Dunedin broadband network to ADSL2+ speed through its network-access division, Chorus.

Chorus product management general manager Chris Dyhrberg doubted a business case supported the council's plan.

"I wouldn't say 'Definitely no'. I would say 'I doubt it - I very much doubt it'," he said.

"It's a lot of money and I think the council needs to be very, very sure it's good use of its money."

Telecom and TelstraClear already provided "more fibre in the ground than you can shake a stick at" in central Dunedin, and Chorus had briefed the council's economic development unit on its broadband plans, he said.

The company aimed to bring broadband of up to 24Mbps to 99% of homes by 2011, possibly followed by 100Mbps fire broadband for high-end users.

A Ministry of Economic Development spokesman yesterday said the broadband fund aimed to address New Zealand's "broadband infrastructure gap", but warned criteria included a viable business case.

"A council seeking to build a new network in direct competition to an existing supplier will in those circumstances have a difficult task in making such a case," the spokesman said.

However, Aurora chief executive John Walsh, of Dunedin, said the very availability of the $340 million fund was a sign of Government frustration with key market players and their failure to deliver.

"We are responding to the Government's proposals," he said.

Council economic development unit manager Peter Harris agreed: "The fact is, central Government wouldn't have this broadband fund if they felt happy Telecom was going to be delivering broadband efficiently and cost-effectively around the country."

And Mr Harris questioned whether broadband should remain in the hands of just a few large companies if, like roads, it was considered a key piece of community infrastructure.

"Is that good for the country? I personally don't think it is. New Zealand is a long way from anywhere and we need to be able to do business as efficiently and cost-effectively as we can.

"I think we need competition."

Mr Dyhrberg responded that Telecom was now a monopoly "highly regulated" by the Commerce Commission, which balanced competition and the retention of investment incentives.

He supported initiatives to encourage broadband development in areas "where natural commercial drivers wouldn't go".

"But I do question how, like in Dunedin where there are two competing fibre networks today, funding a third network is going to do that. If they are trying to solve an issue, I don't think the issue is lack of fast broadband."

Cr John Bezett, who chairs the council's economic development committee, said the initiative would boost the city's education branding.

"We have got to keep up with the latest technology as far as teaching is concerned, and broadband is part of that."

Those spoken to yesterday declined to say how much the network would cost.

Cr Bezett said the cost would be "substantial", while Aurora commercial manager Alec Findlater said the network's total size, and therefore cost, would depend on the size of any Government funding package.

 

 

> Dunedin broadband

• 39km fibre network linking municipal buildings,
businesses, schools, local ISPs, the University of Otago and Dunedin
Hospital.

• Possible expansion into other inner-city areas, portions of North and South Dunedin and hill suburbs.

• Speeds from 100 megabits per second (Mbps) to 10 gigabits per second, with no data cap for the network's users.

• Delta workers already laying ducting to house the fibre cables.

• The first customer expected to be connected by mid-December, and the network completed within three years.

• Network size and final cost dependent on Government funding to be announced on December 1.

• The investment could reduce Aurora's annual dividend payment to the Dunedin City Council.

 

Some explanations needed...

Mr Taiaroa, please explain how paying a thousand bucks a month to get your data from one place in Dunedin to another place in Dunedin is in any way, shape or form going to improve your international Internet service.
Mr Stedman, same answer please.
Mr Telecom, please tell us how many ADSL2 ports you actually have active in Dunedin and how many your backhaul can actually cope with at full rate. It ain't 38,500, that's for sure.
Cr Cull, Bezett, please explain how this proposal is going to provide enhanced residential Internet services to the bulk of Dunedin citizens and tell us why the ratepayers should be hit up to pay for what is essentially a duplicate of infrastructure in a CBD that doesn't actually need it.
Mr University - what are you going to anchor? Otago is essentially one site and is already fibred to the max.
Weasel words all round. This stuff will be gone by December when the funding doesn't eventuate. There are better ways to do it.

DCC Broadband: Missed the boat!

It is incredible that the DCC and its associated companies such as Delta and Aurora failed to seize a superb opportunity to prepare the city for enhanced telecommunications services and now are trying to encroach on established providers who are all after the same limited slice of the pie.

This latest proposal still does not address the fact that there is still no easy method of delivering alternative services to the Dunedin masses save by Telecon's copper wire.

There are of course an exalted few premises that enjoy a link to a fibre optic cable, but for the majority of the city it's business as usual.

For the past few years overhead power lines all over Dunedin have been replaced with buried cables. However, no thought was given to using the same trenches to bury a duct suitable for cable TV or phone services as has been done in cities all over the world.

Likewise, footpaths are often excavated or repaved. Why not take that excellent opportunity to bury a duct with a cable outlet at each office or home? And what future proofing for telecommunication requirements is being required in new subdivisions? None!

Certainly it would take time to cover the whole city, but with careful planning and foresight the task is a remarkably simple one. The additional cost of a plastic duct is minimal, with the added advantages of no additional disturbances or additional rates to business and home-owners alike. The ability to then offer real value-added services would make such an investment by the DCC worthwhile rather than this short-sighted, third rate sticking plaster that does not address the true needs of the city and more importantly its ratepayers.

It is about time the DCC 'think tank' removed its collective heads from the sand and engaged in some collective planning and collaboration.

Broadband risks

The proposed community owned fibre optic broadband network reported in Friday's paper will have absolutely no impact on the price or quality of broadband internet received by the vast majority of Dunedin households, as it seems safe to assume the City will not become an ISP. Nor will it be found installing cables to individual households anytime soon.
This proposed network is all about providing an infrastructure which will help city businesses and institutions exchange data with each other more cheaply than the existing Telco's are willing to do. Metropolitan networks of this type have had some successes, notably in Wellington where redundant trolley bus wires were used to string fibre cables cheaply around the commercial centre. However, the key determinant of success is whether there are enough customers for cross-city data. Not intercity data, not national corporate data, not internet, but cross city data. Typically this cross-city data arises from local businesses or institutions which are spread across multiple premises, or from institutions like schools which have a desire to share local electronic resources. While local businesses spread across multiple premises are common in a city like Wellington, with it's constant churn of Govt departments, there really are only a few institutions in Dunedin that are spread across the city, principally the university and hospital.
The cost of starting up a metropolitan network might be only a few million, particularly if it involves pulling cable into pipes already laid under the roads. However, the incremental cost of adding additional customers can be very expensive as streets and footpaths are subsequently opened to gain access to buildings and operational staff added to ensure the high level of reliability required. Then there is the existing spare capacity around the city that existing telcos are sitting on. They will surely be prepared to sit around and see it overbuilt without any thought of discounting.
The upside of this project is that it might help attract or retain businesses with high cross-city data needs. The downside is that the city could end up with an asset only utilised by a small number of institutions with weary ratepayers footing another large bill one way or another. An alternative model would be for those with the most commercial interest to fund the initial network themselves - possibly in some kind of commercial partnership with the city - and then, if commercial viability is established , the city can assume responsibility for its ongoing economic extension. Of course as taxpayers we should be reassured that the govt's $3m from the broadband fund will never be provided to kickstart a project that wouldn't be viable in the long run for Dunedin ratepayers even if govt funded institutions appear to be the initial beneficiaries.
Gary Johnson

Go DCC broadband!

Well done DCC for taking the lead on broadband. Telecom's strong response would indicate they are wanting to retain their monopoly position and control over this key community infrastructure. Telecom's view of high speed broadband of "up to 24Mbps" seems to be out of line with that of the rest of the world and the DCC's proposal of 100Mbs+ (data uncapped). This is more important than investing in roads, airports and stadiums. Broadband is an imperative for local business, our education section and the future wellbeing of Dunedin.

DCC broadband : We need to see a business plan

We need to see a business plan before a decision is made to go ahead with this. How much will it cost? Who will use it? How much will they pay?
With this service already being provided by others, it is not obvious that this is a good investment. Doing something just because the government is providing a subsidy is not a good reason.

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