Skip to main content

Long Term Evolution vs Short Term Monetisation

After a seminar late last year I commented on some of the potential shortcomings, at least in my mind, of the New Zealand Government's decision to invest tax dollars into ultra fast broadband (UFB).

In recent months Telecom New Zealand, now shed of its fixed access networks after the structural separation of Chorus, has announced its plans for a 4G trial.  This Long Term Evolution (LTE) offering is being adopted across the world and promises to have speeds of 300/75Mbps.

Putting this into context the multi-million dollar investment in UFB promises speeds of at least 100Mbps.  The geography and urban distribution of New Zealand mean that this Fibre to the Premise (FttP) rollout will never be committed to every home in New Zealand, the fixed costs would be prohibitive.  The solution is the adjunct offering of the Rural Broadband Initiative (RBI) that will see a hybridisation of the network to include fixed wireless nodes, and ADSL to try and deliver the dream of ubiquitous access.

Of course this means that for consistent delivery of services, of which the killer application has yet to be realised, will typically mean delivery to the lowest common denominator (either fixed wireless or ADSL).  In parallel Telecom will continue its aggressive push into its mobile network and people will become used to increasing speeds on a selection of form factors.  When we consider the impact that fixed wireless and mobile have made in emerging economies where whole countries and generations have skipped the clunky, restrictive, fixed access (copper) networks and jumped straight to mobile with great success, we should ask what will the usage patterns be of the general consumer by the time UFB and its network of regionalised retail service providers are ready to commence service?

Visit any modern city in South East Asia and you will see the average person using their mobile handset (often enhanced with one of the many tablets available today) in-lieu of a traditional land line.  People are being behaviourally locked in to fully mobile access to voice, email, and a growing array of content.  Will people really want to be tied to services provisioned through a set top box? or would they rather have close to UFB speed, and potentially faster, from their handset and tablet platform with its intuitive user interface?

Admittedly there will be some uptake of FttP services in the business sector. However the ability to fully monetise services at a level that is both palatable for the consumer and that generates revenue at a level to meet the return on invest projections will be tough.

Has the Government merely funded a very useful fibre backhaul pathway for Telecom?

Comments

Post a Comment

Popular posts from this blog

PC over IP - The Teradici Effect

Teradici are hoping to blur the lines between PC and Data Centre. Their solution allows a use to view multiple screens and control the blade PC over IP. This is kind of like the dumb terminals with a new edgy deployment. The intention is that all of the computing power is performed offsite in a centralized area, the Data Centre, and this will save on power and maintenance costs as the engineers are co-located with the hardware and therefore don't have to go out to the client site for basic maintenance. The Teradici Company Article found in the Wall Street Journal
Post a Comment
Read more

e-Olympics

This year's Olympics should be the best ever for coverage. Fring are looking for onsite commentators and as a means to encourage people are offering a 3.5G phone as your reporters tool. I hope that this will be the games of the micro blog. The potential for services like Twitter or Jaiku to open up access to the games in a way never seen before is encouraging. Essentially there are three dimensions to the games: Nation Event Athlete Typically broadcast of the games ha content defined by the nation. The USA channels closely follow the USA squad, the same for UK, NZ Australia etc. This is targeted at the national pride. For those people who are actively engaged in an event themselves, marathon, it's the event that is king. There will still be an element of "my country" but this is equally balanced by "my sport". The final element is the followers of a specific athlete. Friends, family and fans may elect to follow all of the events surrounding a person. ...
Post a Comment
Read more

Cashless Society? Micropayments up for disruption

New Zealand, although small, is a long way ahead in many aspects compared to the UK. Some of their new schemes are being adopted by the UK government. What I remember from my first trip here 6 years ago was the impact of the EFTPOS system. Long before the UK was using Chip and PIN New Zealand was moving towards a cashless society with the ubiquitous EFTPOS (Electronic Funds Transfer Point of Sale) cards and terminals. The system is good and robust. But the one place you can't find it for some of those micropayments is on the public transport system. Buses would benefit from some form of electronic payment system. There is one drawback of the system in it's implementation today, the time taking to pay. For small payments, say a Moro (think Mars) Bar at the local dairy (corner shop) is the time taken for the system to recognise the card and for the user to select the account (Cheque, Savings or Card) and input their PIN. This would certainly slow down the boarding process...
Post a Comment
Read more