Power line companies ally to push fibre, oppose Telecom

[UPDATE: at Telecom's midday press conference on its own submission, chief executive Paul Reynolds responded to the RFC's criticism that it had not specified any plans for connecting business. Dr Reynolds said most busineses can already get fibre on request with a few weeks. Chorus boss Mark Ratcliffe added that in rural areas, business tend to be clustered in the same areas as schools, which would help reach.

Mr Ratcliffe said Chorus was willing to work with power line companies, and that it already co-operated with various utilities to lay common ducting.]

Nine power line companies and fibre specialists have formed the New Zealand Regional Fibre Group (RFC). It hopes to provide the industry with a united voice as it seeks $1.5 billion in Crown fibre funds. The new group has some harsh words for Telecom’s submission.

Vector led the move to create the coalition, and the company’s chief executive, Simon MacKenzie, is serving as its spokesman.

Mr MacKenzie says the RFC made a joint submission in response to the government’s Crown fibre discussion document. Some members have also made individual submissions – but with common themes such as plans to provide consistent service across the country.

The RFC opposes Telecom’s submission, released this morning, which seeks a single, centralised network built by Telecom division Chorus.

“It’s just a minor modification of what Telecom’s already doing,” Mr MacKenzie told NBR. “They want to manage the risk to their copper network.”

Mr MacKenzie says Regional Fibre Group members are just as capable of pushing forward access to hospitals and schools.

“The key missing feature [of Telecom’s submission] is that it makes no mention of an accelerated timetable for connecting business. Fibre-to-business is essential to the government’s aspirational goal of a achieving a step-change in New Zealand’s international competitiveness.”

Mr MacKenzie says the RFC’s key submission themes were:
1. It strongly supports the government’s proposed network of up to 25 public-private local fibre companies.

2. The government’s funding model needs to stack up commercially and make a return for investors – but the government also has to be flexible in how large a stake it takes, or doesn’t in each LFC.

3. LFCs need to provide “lit” fibre ready to be connected to customers to make sure there is strong retail competition. It should not let providers buy up chunks of “dark fibre.” Organisations buying access will range from internet service providers to councils to entertainment companies, and access has to be as open and easy as possible.

4. There “will be an element of monopoly” (read 25 fibre fiefdoms) so the government does need to provide regulatory certainty.

The Regional Fibre Group’s members include lines companies Vector (Auckland and Wellington), Aurora (central Otago), Network Tasman, Northpower, PowerNet (central Otago and Southland), Unison (Hawkes Bay, Taupo and Rotorua) and WEL Networks (Waikato) plus fibre network specialist Velocity Networks (Hamilton).

Many of its power line members have also branched out into laying fibre, with Northpower allying with TelstraClear, and Vector providing backhaul in Auckland for Vodafone.