Consortium to provide fibre broadband to South

Media release
13 January, 2010

Consortium to provide fibre broadband solution to South

Broadband connectivity in Otago and Southland is due for a major shake up thanks to the formation of a fibre optic consortium aiming to end the traditional copper network monopoly.

With Government backing, the consortium is intending to invest in an ultra-fast fibre optic broadband network throughout the Southern regions - one that is capable of 100 Mbit/s speeds.

Flute Network is a joint venture partnership between Dunedin and Central Otago’s Aurora Energy, along with Southland’s Electricity Invercargill and The Power Company.

Aurora Energy and the management company representing the other two Flute partners, PowerNet, are part of the New Zealand Regional Fibre Group, a collective of 19 lines and fibre companies stretching the length and breadth of the country.

Combined, the NZRFG membership can provide fibre networks to the Government’s preferred population base in 33 towns and cities, while extending out into rural areas also.

Grady Cameron, CEO of Aurora, says Flute is currently developing a proposal to co-invest with the Government to deploy and operate fibre optic infrastructure as part of the Crown’s ultra-fast broadband initiative. The joint bid is due at the Ministry of Economic Development in Wellington on January 29.

The Government last year signalled a desire to front with $1.5 billion and partner with private sector parties to drastically improve the nation’s chronically under-invested broadband infrastructure.

Flute’s creators believe New Zealanders have put up with sub-standard services from traditional telecommunications suppliers for too long, something that has unnecessarily stifled economic productivity.

Combined, the Flute partners boast a vast reach to over 150,000 customers from Bluff to Wanaka, and including Queenstown, Invercargill and Dunedin, through electricity networks alone.

The companies say, if successful in the bid, they plan to remove Southland and Otago’s reliance on traditional telco network providers. Flute wants to deliver a long overdue step change in broadband capability needed to move the region forward.

Flute’s formation follows that of another NZRFG collective just before Christmas – the Waikato-based WEL consortium.

Having previously stated a desire to become the Government’s preferred provider of regionally based, nationwide fibre solutions, the NZRFG says the Government can expect bids from a number of members – some consortium driven and others individual.

The Government wants 75% of New Zealanders to access ultra-fast fibre networks within 10 years; a target the NZRFG says it can comfortably reach given its membership covers an even greater percentage of the population.

Flute believes it has the substantial regional infrastructure needed to quickly and effectively rollout a fibre network to much of the South.

Mr Cameron says that is the benefit of electricity lines companies deploying fibre.

“We have comprehensive lines networks in place already and are more focused on regional economic development, spill-over, social and environmental outcomes than those traditional telecommunication players, whose motivation is more purely commercial,” says Mr Cameron.

“What people must remember is that the UFB initiative is much broader than telcos. Infrastructure providers like Aurora, The Power Company and Electricity Invercargill are ideally placed to add fibre to our existing electricity networks. Our assets are critical to the regions and so broadly spread throughout these areas that it makes sound commercial sense to add fibre optic cabling to our poles or underground ducting.

PowerNet CEO Martin Walton says the Flute approach to fibre will be regionally wide, not just focused in urban areas, ensuring the rural sector is well catered for with substantially faster broadband speeds.

“In an infrastructure sense that means we’ll be focusing on urban fibre, regional backhaul and rural hybrid deployments,” says Mr Walton.

“No one can deny that together we are a safe pair of hands to look after the long-term telecommunications interests of consumers in our regions – and we have plenty of local support for this. It is very much complementary to current regional digital strategy and broadband initiatives.

“We want our customers to make use of applications like real-time video conferencing but that can only happen with acceptable broadband speeds. Currently that is not a reality for most but fibre will change that,” says Mr Walton.

ENDS

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