InternetNZ: Telecom-Vodafone has no incentive to upgrade to 4G
InternetNZ and Kordia keep the acid on Steven Joyce as the government enters negotiations with Telecom-Vodafone for its $300m rural broadband initiative.
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InternetNZ and Kordia are trying to keep the acid on Steven Joyce as the government enters negotiations with Telecom-Vodafone for its $300m rural broadband initiative.
A centrepiece of the Kordia/FX Networks/Woosh bid was that it had 2300MHz spectrum that allowed for a 4G cellular network from the get-go (to complement the fibre component of the rural network).
The Telecom-Vodafone biid, by contrast, could not offer the faster 4G until 700MHz spectrum was freed up by the digital TV changeover, scheduled to be completed by the end of 2013. In the meantime, they would offer 3G.
On Monday, Communications Minister Steven Joyce told NBR that 3G was "a proven technology".
Mr Joyce added that 3G to 4G was an easy step (and NBR understands from Nokia-Siements - which partnered both Telecom-Vodafone and Kordia/FX/Woosh in their rival bids, that the process is a software upgrade, not requring any new hardware).
No commercial incentive
Yesterday, InternetNZ chief executive Vikram Kumar told NBR that while it might be technically easy to upgrade from 3G to 4G, Telecom-Vodafone had no commercial incentive to do so.
With the contract in the bag, it would be cheaper to sit on 3G.
"[A 4G upgrade] will therefore happen when Vodafone wants it rather than in response to either customer need or some sort of obligation to upgrade," Mr Kumar told NBR.
Rural customers would have no guarantee of faster speeds, lower contention (fewer customers sharing the same bandwidth, or lower pricing, "nor the ability to really influence the dominant provider."
Held hostage
Kordia also picked up on this theme yesterday, saying rural New Zealand would be "held hostage" under this slower wireless technology (the state-owned company also maintains its bid would have seen faster guaranteed landline speeds).
Chief executive Geoff Hunt said providers all around the world were upgrading to 4G now. Kordia rejects the criticism that 2300MHz spectrum, with its shorter throw, is more suited to urban deployments.
Earlier in the week, Mr Joyce said wholesale pricing for the wholesale rural network, and terms under which retailers could access it, were included as items in the government's commercial negotiations with Telecom-Vodafone.
Yesterday, NBR asked if a 3G-to-4G upgrade committment would also be part of the Telecom-Vodafone contract.
The minister has yet to respond on that point.
No guarantee of spectrum
InternetNZ's Mr Kumar noted the minister's previous comment, to NBR and others, that the rural broadband tender winner would have to bid for 4G spectrum in 2013, with no special priority over other contenders - making it problematic to enhrine a Telecom-Vodafone committment to upgrading.
Chris Keall
Thu, 10 Feb 2011
Thu, 10 Feb 2011
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InternetNZ: Telecom-Vodafone has no incentive to upgrade to 4G
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