In a surprise move, a group calling itself the Torotoro Waea Partnership has revealed it has partnered with Opto Networks to make a bid for the government's $300 million rural broadband initiative. Torotoro Waea is an alliance that includes 24 members, in
In a surprise move, a group calling itself the Torotoro Waea Partnership has revealed it has partnered with Opto Networks to make a bid for the government’s $300 million rural broadband initiative.
Torotoro Waea is an alliance that includes 24 members, including various iwi, and "industry partners".
A joint Telecom-Vodafone bid and a rival bid from a consortium of lines companies, the Regional Fibre Group, have already been revealed over the past week.
A consortium involving Kordia, FX Networks and Woosh is also thought to be in the race.
The MED is due to come up with a shortlist by Christmas.
Torotoro Waea's primary industry, Opto Networks, is a start-up launched in November 2009 by IT industry veteran Roger de Salis, has said that it will use FX Networks backhaul network if it succeeds with a Rural Broadband Initiative bid.
Opto-FX ties
Opto Networks' Roger De Salis is a former director, and current private equity shareholder, in FX Networks.
FX is 30% New Zealand owned. Its majority shareholder is Peregrine Management Group Ltd, which lists an address in the Isle of Man - commonly used as a tax haven.
In a statement, Torotoro Waea promises to link not just rural schools - as required by the tender - but 1000 marae. Areas that could not be reached by cable would be served by 3G/4G celltowers.
On the face of it, both Opto and Torotoro Waea will struggle to meet the terms of the RBI tender, which was revised on August 26 with a new emphasis on national infrastructure, and a requirement that aspirants possess “financial backing to guarantee their proposal across the whole country.”
However, one industry insider was quick to speculate to NBR that 2degrees - in which the pan-iwi Hautaki Trust owns a (now much-watered down) 13% stake, with its Crown-granted spectrum traded for shares - could join the party to provide some financial muscle.
2degrees is now majority owned by US company Trilogy International Partners.
An industry insider also mused what the bid could mean given the government's willingness to accommodate Maori Party interests in various areas.
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UPDATED: Torotoro Waea spokesman Antony Royal said if the consortium's bid is accepted roll out could be within three years.
He said the broad philosophy of the group was to ensure that rural communities were well serviced and there was a general distrust that other companies and bidding organisations we not making service the priority.
As a result, Mr Royal said the Torotoro Waea bid was not profit focused and instead had a goal of driving wholesale broadband prices down in rural communities in order to maximise its reach through affordability.
In addition, he said there was a broad concept of "genuine" open access, which was part of the cost slashing push.
Essentially, the organisation's goal was to have one set of infrastructure build that would service any retail provider, minimising duplication of services - a contentious issue in itself.
"Our proposal is to roll out faster than what the government has asked for and we're looking to fund a chunk of it ourselves."
Mr Royal said funds were available through some of the Maori partners and also through debt.
While 2 degrees stakeholder Hautaki has been suggested in some quarters as a potential partner for the new consortium, Mr Royal said it isn't at the moment. However, the door is open.
"Hautaki just hasn't had the chance to talk about it yet," he said.
