New Zealand telecoms market

08 July 2013 |


Over the last few years, New Zealand has emerged as one of Oceania's most progressive telecommunications markets, ranking 20th in the world for its connectivity, according to the latest World Economic Forum.

 

This will be further boosted by two nationwide government initiatives; the Ultra-Fast Broadband (UFB) project and the Regional Broadband Initiative (RBI). The former is expected to be completed by 2020, while the latter, which is a joint venture between Chorus and Vodafone New Zealand, will see the installation and upgrade of fibre to roadside cabinets, with retail service providers connecting end users. “The completion of the UFB and RBI roll-outs, alongside expansion of 4G mobility and an increasing network of Wifi hotspots, will deliver increased and more seamless coverage across the country,” says Richard Llewellyn, head of corporate communications at Telecom New Zealand.

Both Telecom New Zealand; the country’s national incumbent, and Vodafone New Zealand; the country’s largest mobile phone operator, have made significant efforts this year towards increasing domestic connectivity. In April, Vodafone New Zealand announced its first rural trial of 4G services in Lake Brunner, in New Zealand’s South Island, which it expects to run until the end of July using 700MHz technology. “We are working in partnership with the government to bring broadband to rural communities through the Rural Broadband Initiative (RBI), and we have committed to making all the RBI sites upgradeable to LTE,” says Tony Baird, head of networks at Vodafone New Zealand.

The trial is designed to provide valuable data to support the eventual roll-out of 4G services in rural New Zealand, and Vodafone plans to deliver the services to Christchurch, Wellington and 15 other cities across the country by the end of 2013. Telecom New Zealand also partnered with Chinese equipment vendor Huawei in April for the deployment of 4G services. “Given the rapid growth in demand for data and mobility around the world and in New Zealand, we see it as all about adding to the quality mobile experience offered by Telecom New Zealand’s Smartphone Network,” says Llewellyn.

Research firm BuddeComm confirms the need for better mobile connectivity in the country, and in a recent report noted New Zealand’s lack of ubiquitous mobile broadband coverage, which has led to a heavy reliance on fixed-line networks. Being a relatively small island nation, New Zealand places much emphasis on subsea cables for its international connectivity, an area Telecom New Zealand has strengthened through its partnership with Vodafone and Telstra for the Tasman Global Access (TGA) submarine cable.

The TGA cable is designed to link Auckland, in New Zealand’s North Island, and Sydney, Australia, reflecting the growing importance of trans-Tasman internet traffic in the Oceanic region. According to Llewellyn, connectivity to Australia makes up approximately 40% of both Telecom New Zealand and Vodafone New Zealand’s international internet traffic, compared to 10% in 2000. “The TGA cable will enable New Zealand to better leverage the four additional international cable systems serving Australia – with several more proposed or in development – providing important redundancy for New Zealand,” he says.

The system could also help improve connectivity from New Zealand to neighbouring Asian markets. “With major fibre domestic projects in both Australia and New Zealand [such as the UFB] it will be interesting to see the impacts on downstream international connectivity demand,” says Fiona Beck, president and CEO at Southern Cross Cable.

Southern Cross is largely focussed on connectivity between Australia, New Zealand, Fiji, Hawaii and the continental US. “We recently introduced 10G and 40G OTN service offerings, and are developing 40GbE and 100GbE, along with 100G OTN services in partnership with our suppliers which we plan to bring to market over the next 12 to 18 months,” Beck says.

The company recognises a need for data consolidation in key locations not only in New Zealand but internationally, and notes the need to strike important relationships with data centres. “Over the last 18 months we have also expanded our options to include connectivity directly to Equinix in Sydney, along with the Westin Building in Seattle which houses a majority of the major content providers,” Beck says.

Southern Cross is also looking to connect directly to Los Angeles, as well as a potential second location in Sydney, and one in Auckland.

Beck believes that in spite of the country’s remote location and relatively small population, the roll-out of the UFB and the deployment of the trans-Tasman cable will address the country’s furture demand for domestic and international connectivity. “I think the next few years will prove interesting and hopefully supportive to New Zealand operators in this area,” she says.


COUNTRY INFORMATION



4,400,000  

Population (2011)

268,680 km2

Land area  

Wellington 

Capital

English, Maori  

Language  

New Zealand Dollar (NZD)

Currency

$161.9 billion

GDP (2011 est.)