Telecommunications state of the nation

The telco sector has come together to launch a report on just how much the telco sector does for New Zealand.

To be fair, it's pretty good reading. World class levels of investment. One of the fastest 4G countries anywhere. Fastest uptake of fibre by consumers globally. Connection speeds have increased, customers are moving to the long-denied "unlimited" traffic plans, costs are down and households are consuming twice as much data as they did a year ago. 

Telecommunications is a key force in the economy in New Zealand and it's good to see just how much is being done spelt out for all to see.

The report doesn't touch on the more contentious issues in the industry – long hold times for customers, customer service satisfaction scores that make one wince, tales of woe from retail service providers (RSPs) and customers alike when connecting to fibre networks, rural customers still unable to get a service for a decent price and the levels of competition are still less than ideal – but it is an excellent benchmark of what the industry is doing well.

All of this is happening at a time when the industry faces a stark choice in terms of its future direction. Will the companies continue to offer the full suite of services and try to be all things to all people, or will they become  utilities – the dumb pipe that allows customers to do whatever it is they want?

Companies like Spark [NZX: SPK] are investing in delivering over the top services (such as video on demand) and trying to compete with the global might of Netflix and others. Other telcos are rushing to offer the lowest price and to attract the most customers possible.

And on top of all that we'll see the launch of a new regulatory regime in the next couple of years – the third or fourth (I've actually lost count) in a decade. For an industry that spends billions of dollars each year that's a difficult proposition at best and at worst means we could lose this edge we've acquired in the last few years.

So what will our telecommunications environment look like in 2020?

By then we should have finished the UFB and RBI projects as they stand today. I'd hope we'd be on to launching UFB 2.0 and rolling out fibre deeper into rural communities because by then our household demand for speed will mean we consider 100Mbits as an entry level product.

Our 4G networks will be rolling on to 5G (however you like to frame that up in marketing terms) and we'll have eye-watering speeds, albeit with more contention and no doubt still the ubiquitous black spots and drop outs. Maybe by then we'll have figured out that international roaming is a silly idea and telcos internationally will do away with these foolish extra charges.

By 2020, we should also have a second submarine cable connecting New Zealand to the world, albeit going to Australia. We may even have a third but that seems more of a pipe dream than ever before.

The copper network will be turned off by then, amid wailing and howling at the need for old people and earthquake-prone regions to have a second network solely for redundancy purposes. But it has to go because the cost of maintaining such a thing is not reasonable.

I trust we'll still have an independent telecommunications commissioner because while the industry has come far in the past decade it still has a long way to go and the role the commissioner has played is vital. I'd like to see the broadcast and communications regulatory regimes harmonised because currently they are miles apart despite being two sides of the same coin.

And most of all I'd like to see regional economic development off the back of UFB deployment. In the old days, most jobs were centralised in the big cities because we were all factory worker drones and needed to be in one place to do our jobs. The digital revolution frees us from that and if we want to solve the housing problem, transport problem and employment problem in one fell swoop, this is it. Encourage businesses to move to the regions for cheaper rent. Encourage staff to work remotely whenever possible. Work collaboratively between regions wherever possible.

That's the true legacy of the telecommunications regime we have today.

Paul Brislen is the editor of IITP's Techblog, as well as a former chief executive of the Telecommunication Users Association. He regularly comments on the technology issues of the day.