CommsDay Auckland Summit

NZ Commerce Commission telecom commissioner Dr. Ross Patterson and Chorus CEO Mark Ratcliffe have identified several key challenges for New Zealand’s transition to a fibre future, from uptake issues to resistance from a well-entrenched copper culture.
In their respective speeches at the CommsDay Auckland Summit, Patterson and Ratcliffe approached the state of New Zealand broadband from the very different perspectives of commercial stakeholder and regulator, but nevertheless touched on several of the same issues.
Both highlighted cutover and fibre adoption rates as very real hurdles. Patterson (right) picked up the example of Japan, with just 30% uptake of ultra-fast broadband despite 90% of households now being connected to fibre, and the incumbent now threatened with structural separation as a result. “‘Build it and they will come’ has not been shown to the case in Japan... clearly, the copperfibre transition raises interesting issues,” he said. Ratcliffe, meanwhile, warned that the challenges of cutover should not be underestimated, adding that many developers were still reluctant to run fibre to new properties in the face of the strength and diversity of existing copper services.
The commissioner’s own assessment of the current fibre market went into more detail on the state of play in copper. Patterson pointed out the strong growth in the ULL market – to 10% of all connections by the end of the March 2010 quarter – despite New Zealand’s late move to unbundling, and fears of FTTN cabinetisation cannibalising the addressable market. He also noted the imminent VDSL wholesale launch from Telecom.

Given this enduring popularity of DSL, Chorus is looking at ways to capture the copper market while still leaving the door open for fibre. According to Ratcliffe, the firm has developed a hybrid copper-fibre cabinet for greenfields that uses microducting to accommodate the different access demands of different customers. “You can pull the copper out of a microduct and blow fibre through it,” he said. “And the cabinet can provide both point to point and GPON.” This kind of fibre flexibility feature may provide some reassurance for Patterson, whose final point

was an argument for the competitive benefits of point-to-point over PON technologies. “Point-to-point provides the most open and flexible architecture, with the highest potential bandwidth and feature innovation, and the most flexible for competitive collaboration,” he asserted. “One of the big challenges is the danger that to save costs, a decision is made to adopt a PON architecture that cannot be unbundled effectively.”

“Some say that in five years’ time there will be some technology that is able to unbundle PON, but that’s a complete unknown; we would certainly say that the extra investment now is critical to get the competitive outcomes that the initiative was designed for.