The Ultra-Fast Broadband (UFB) Initiative – Policy
Q: What is the Ultra-Fast Broadband project?
A: The Government’s initial objective was to accelerate the roll-out of Ultra-Fast Broadband to 75 percent of New Zealanders by 2019, concentrating in the period to end the of 2015 on priority users (businesses, schools and health services), plus greenfields developments and certain tranches of residential areas. In late 2014 the Government announced its intention to expand the Ultra Fast Broadband project to reach at least a further 5 percent of the population (being 80 percent in total), as described here.
The UFB project is building what is known as a Fibre To The Premise network. The Government’s investment is in partnership with the private sector, and is directed at open-access infrastructure (open to any service providers). Crown Fibre Holdings Limited (CFH) was established to manage the Government’s $1.35 billion investment in UFB to reach 75 percent of New Zealanders, and has also been tasked with managing the expansion of the scheme.
Q: What are the priorities in deploying Ultra-Fast Broadband?
A: Government policy is to prioritise the UFB build to ensure that designated priority users including all schools and public hospitals as well as the vast majority of businesses and health facilities are reached by the end of 2015. The UFB rollout to residential areas including greenfields sites is also well underway, is expected to be concluded by the end of 2019 with some towns and cities finished well in advance of this date.
Q: What is considered “ultra-fast” broadband?
A: UFB policy is to offer services of at least 100/50Mbps (100 Megabits per second Downstream, 50 Megabits per second Upstream). By way of comparison, the average speed measured by web services firm Akamai in Q3 2014 in New Zealand was 7.0Mbps.
Q: What determines where UFB is deployed first?
A: The framework for prioritisation which has been agreed between CFH and its partners includes:
- clusters of schools, health premises and businesses;
- in the initial period, areas of high demand;
- areas of high density;
- build on from existing networks transferring into the UFB scheme (Chorus in Auckland, Wellington etc.; Enable in Christchurch);
- due consideration to major events, working with local works underway, etc.; and
- likely costs of deployment (determined by geology & topography, local planning rules etc.).
The contracts covering Whangarei and the central North Island (Hamilton, Tauranga etc.) were signed approximately 6 months before those covering the rest of the country, so it is to be expected rollout is a little ahead in these areas.
Q: UFB policy is to offer services of at least 100/50Mbps (100 Megabits per second Downstream, 50 Megabits per second Upstream). Why in that case are there 30/10Mbps plans?
A: The 30/10 plan is an entry level wholesale product which provides higher bandwidth speeds (and a much better Committed Information Rate) than current ADSL2+ copper broadband products used by most New Zealanders. A 100/50 Mbps product is available to all UFB customers and is reasonably priced at wholesale.
Q: How are the Government and its partners working together to deliver UFB?
A: The Government has 4 contracts in place to deliver UFB, with the following parties:
- Northpower Limited (for Whangarei);
- WEL Networks through its subsidiary Waikato Networks Limited (Hamilton, Tauranga, Whanganui, New Plymouth, Tokoroa, Hawera, Cambridge, Te Awamutu);
- Enable Networks (Christchurch, Rangiora including satellite areas such as Rolleston, Kaiapoi etc.); and
- Chorus, formerly the network arm of Telecom Corporation of New Zealand (covering Auckland (including parts of Waiheke Island, Waiuku and Pukekohe), Rotorua, Taupo, Whakatane, Gisborne, Masterton, Napier-Hastings, Palmerston North, Feilding, Kapiti, Levin, Wellington, Nelson, Blenheim, Ashburton, Dunedin, Timaru, Oamaru, Greymouth, Queenstown, Invercargill).
The first three contracts create “Local Fibre Companies”, which are joint venture companies between CFH (on behalf of the Government) and the partners listed above.
As part of the Telecom contract, Telecom was required to separate into two companies, one called Chorus which owns the local UFB and copper network infrastructure, and another now known as Spark which owns the mobile network XT and relationships with residential and business customers. In late 2011, Telecom’s shareholders approved the split of the company into two entirely separate entities: Chorus Limited, which is partnering with CFH for the UFB project, and Telecom (since rebranded as Spark) which is competing in the mobile and retail markets.
Q: What is “open access”?
A: Open access is a key principle underlying the government’s UFB initiative. It is critical that the networks built provide the highest levels of interoperability with other networks and are future proofed. Local Fibre Companies (LFCs) are required to deal with the market in a fair and equitable manner, providing for equality of access and allowing end users to switch easily between providers. These principles also require strict separation between the fibre network operators (Local Fibre Companies and Chorus) and the Retail Service Providers (RSPs) who provide services to end users such as consumers and businesses.
Q: What is a Local Fibre Company?
A: An LFC is a joint venture between Crown Fibre Holdings on behalf of the Government and a private company to deploy, own and operate a fibre-to-the-premise network in one or more parts of New Zealand under the UFB initiative. LFCs sell point to point Layer 1 Services (known as “dark fibre” as they need to be “lit” by another company in order to transfer data), and Layer 2 Services (known as “lit fibre” as the electronics needed to transfer data are already in place).
Q: Why do we need to replace copper networks?
A: Copper networks were originally built for phone lines or POTS (Plain Old Telephone Service). Most broadband currently operates over copper, but copper has its limits, namely in speeds and bandwidth of broadband. Fibre is the next generation of broadband infrastructure, and can be expected to be an asset with a lifetime of 40-50 years or more. As our needs for more data and higher speeds escalate, we need to improve our infrastructure. Copper services deliver less speed as one gets further from the exchange; fibre services do not. Copper services deliver less speed the more users are on the network at a given time (this is known as “network contention”); fibre services do not. While the copper network has served New Zealand well, it has been in place for many years. Maintenance costs on copper will increase as it approaches its “end of life” in coming years.
Where and when is Ultra-Fast Broadband (UFB) being deployed?
Q: Where is UFB being deployed?
A: UFB is being deployed to the 33 largest towns and cities in New Zealand by the end of the decade. Within these areas, access is being enabled to schools as well as the vast majority of businesses and health facilities by the end of 2015. The build in residential areas is well underway but will not be completed until 2019; greenfields residential areas, those with poor current broadband access and areas with high propensity to purchase UFB are being prioritised.
Q: How were these 33 towns and cities selected?
A: The UFB tenders specified UFB would target the 75% of New Zealand’s population living in the largest 33 towns and cities, based on Statistics New Zealand’s projections for their population for 2021. This is approximately the end of the UFB deployment period.
Q: What about the rest of New Zealand?
A: The Government has a separate Rural Broadband Initiative which aims to improve broadband services in rural areas. This $300m project has led to two contracts, one with Chorus to deploy fibre to regional and rural schools, and another with Vodafone to build a number of new mobile towers, and upgrade a number of others, to enable improved mobile and broadband services.
In late 2014 the Government also announced its intention to expand the Ultra Fast Broadband project to reach at least a further 5% of the population, being 80% in total, as well as to extend the Rural Broadband Initiative. Further information is available here.
How is UFB being deployed?
Q: Is UFB deployment be aerial or underground? Will my street be dug up as part of deployment?
A: UFB deployment must comply with the applicable District Plan. Deployment is generally underground, but may use existing electricity poles where these are available and the use is approved within the local District Plan. The UFB deployment partners are working with local Councils and transport authorities to minimise community disruption caused by the UFB build. UFB in greenfields developments / subdivisions is generally underground.
Q: For underground deployment, are trenches be dug to traditional depths or may newer “shallow trenching” techniques be used?
A: Again, this depends on the local District Plan. Standards relating to fibre deployment form part of the Utilities Code, and provide guidance on how shallow trenching techniques may be used where this complies with the local District Plan.
Q: Will fibre be deployed through existing water or sewerage pipes?
A: The UFB deployment partners are open to a number of techniques which could reduce the cost and increase the efficiency with which UFB is deployed. This could include use of existing infrastructure such as water and sewerage pipes. However, these techniques have yet to be trialled in New Zealand.
Q: How is fibre connected from the street to my home?
A: The connection is to a device known as an ONT (Optical Network Termination device) which the LFC installs, owns and maintains. The ONT is the point at which the fibre service connects to networks in your home (which may be copper, Ethernet, Wi-Fi etc.) The ONT is located in a position of the householder’s choice. An additional fee may apply if the householder wishes to site the ONT in a difficult location or a long way from the street frontage. The ONT requires a power source.
If existing utility services are aerial, an aerial line is run by the fibre operator to the house, and thence to the ONT via a small drilled hole.
If existing utility services are underground, UFB may be able to be deployed without digging if existing services are in ducts with spare capacity. If no ducts are available, a narrow trench line is dug or drilled according to the requirements of the householder from the premise boundary to the ONT. The fibre deployment companies (LFCs and Chorus) are responsible for the process and for reinstating the garden / driveway to the satisfaction of the householder.
Q: If UFB deployment is aerial, does it create “visual pollution”?
A: No. Each fibre strand is no thicker than a human hair, so services have little if any visual impact on the community.
Q: What happens to legacy copper services when I connect to UFB?
In the home, services such as fax, security alarms, St John’s medical alarms, EFTPOS, Sky TV connections – which run over copper today – can generally be configured by your service provider to operate with UFB. Ask your RSP for more information on this as part of the process of connecting.
Q: What happens to the copper itself when I connect to UFB?
A: At least initially the copper will generally remain in place. In the future it is possible that legacy copper will be removed but this is subject to further consideration by the Government, industry and other stakeholders.
Q: Are there be upfront fees to connect to UFB?
A: At a wholesale level (from the LFC to the RSP) there are no connection fees for standard residential installations. It is up to Retail Service Providers (RSPs) whether they charge an upfront fee to connect, as they set retail prices.
Q: Should I re-wire my home to enjoy the benefits of UFB?
A: Re-wiring should not be necessary. There are options for delivery of UFB in the home using Wi-Fi which require no new wiring. These may not be suited for homes which are made of concrete or brick, and it is also important to consider the location of the ONT and wireless router. The ONT can also connect into existing in-home copper wiring which delivers your fixed phone line etc. Your RSP can provide more specific advice applicable to your circumstances.
If you are renovating your home it is worth planning for your future communications requirements. Power users (for example, those who may wish to have multiple family members accessing different media-rich video services at the same time) may be best to upgrade their in-home wiring to Cat 5 or 6 standard. If you are doing so, ask your contractor to follow the TCF Premise Wiring Code.
Q: Can I choose more than one RSP to provide services over the fibre?
A: In the home, the open access model enables householders to choose more than one service provider, potentially offering different kinds of services. Some of these may be new or niche service providers offering services such as cloud computing, support for particular applications, game-playing, e-health etc.
Q: I already have a broadband contract. What should I do if my service provider offers to renew my contract?
A: It is worth thinking about UFB services before you re-sign with your current service provider. If UFB services are available in your area, ask your RSP if they offer UFB services. If UFB services will soon be available in your area, ask your RSP for a contract allowing you to migrate to UFB if you wish to do so when it is available. If you wish to take up a UFB service, it is advisable not to sign long-term contracts (2 years or above) with a service provider unless they will agree to migrate you onto UFB when it is available.
UFB Products / Prices / Retail Services Providers
Q: Which RSPs have signed up to sell UFB services?
A: A number of RSPs so far have concluded agreements to sell UFB services. These include Spark, Vodafone, Orcon, Slingshot, Snap, NOW, DTS, Uber Group, Ultracomm and many others. To get started, you should ask your current service provider whether they’re selling UFB. Check Chorus or the LFC websites to see which RSPs are selling where.
Q: What data caps may be expected to accompany each UFB product and price point?
A: Data caps are set by RSPs and are not in the control of CFH or LFCs. However, CFH believes that cost effective access to UFB at the wholesale level supports larger data caps at the retail level and greater data usage by end users. Data caps have been increasing in recent years, and unlimited UFB plans are also available from many RSPs.
Q: What are retail prices for standard household UFB products?
A: Retail service providers set retail prices, not CFH or the UFB deployment partners. Retail fibre prices for the residential market are roughly the same as for services over copper, but for a far superior offering. Premium offerings may attract a higher price tag, of course. Retail prices for the business market are significantly less because there’s no need to buy multiple copper voice lines.
Q: Can the wholesale input costs for UFB change over time?
A: Signed contracts to form Local Fibre Companies cover pricing to the end of 2019. Prices generally are flat or declining over that period of time. There are no increments on UFB wholesale prices for the Consumer Price Index, so in real terms all UFB input prices get cheaper each year.
Q. Why are the basic residential plans asymmetric (more Downstream than Upstream)?
A: The network which is being deployed for the residential and small business market is known as a “GPON (Gigabit Passive Optical Network) topology. This is asymmetrical on a 2:1 ratio meaning there is twice as much downstream capacity as upstream. Retail Service Providers can purchase additional upstream capacity at their discretion to construct symmetrical GPON services. While GPON services are asymmetric by nature, the up stream speed available (10Mbps minimum) is much higher than that of current ADSL2+ copper broadband products used by most New Zealanders (1.0 Mbps or less). Point to Point Ethernet services for the enterprise market are symmetric.
Q. Can the LFCs’ GPON networks be “unbundled”, so that RSPs can purchase “dark fibre” and add on their own services?
A: Yes, this is required to be offered after December 2019 in GPON areas. In P2P areas (mostly business areas and CBDs), Dark Fibre services are already available.
UFB usage and applications
Q: What can UFB be used for?
A: A range of new applications and services may be enabled in the home as a result of UFB, including:
- Video conferencing (home-to-home, home-to-school etc.)
- IP TV and new advanced TV services such as 3D and High Definition services.
- Home Wide Area Network, allowing multiple homes (for example across an extended family) to easily store, access and share large amounts of information such as video or photos
- Cloud computing applications for game-playing, office applications, online backup, file syncing and so forth
- Tele-health applications in the home
- Education applications in the home
- Remote working / working from home
Q: Do RSPs sell entertainment services such as IP-TV?
A: Fibre certainly enables the delivery of a rich portfolio of entertainment options, but it’s for RSPs to determine what they choose to offer.
Q. Do UFB wholesale products support voice telephony?
A: Yes. For example the basic residential product includes an Ethernet port and an ATA (Analogue Telephony Adapter) port. Voice services can be offered using either port, or both. The ATA port supports legacy voice telephony akin to the PSTN (Public Switched Telephony Network) used by most NZ households and businesses today, while the Ethernet port supports Voice over IP.
Q: What ports are available for use by Retail Service Providers?
A: Ports are located on the ONT, placed in the household or business premises of end users connecting to UFB. The standard configuration of the ONT provides 4 Ethernet ports and 2 legacy Voice (ATA) ports. This provides capacity for a number of different RSPs to deliver services into the one home. Generally speaking, the Ethernet port supports broadband and Voice over IP and Video applications, while ATA ports can support most standard services currently delivered over the PSTN, including voice telephony, fax, alarming etc.