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The Standard

Fry puts heat on broadband

Written By: - Date published: 9:47 am, February 22nd, 2012 - 64 comments
Categories: infrastructure, national, Steven Joyce, telecommunications - Tags: , ,

Steven Fry’s outburst on broadband in NZ, however confused, did at least succeed in putting the state of our broadband access back in the headlines for a bit. It’s an issue that the Nats would rather we forgot. Remember these empty promises back before the 2008 election?

National’s latest billboard highlights the party’s commitment to rolling out an ultra-fast broadband network, says National Party Leader John Key.

“A National Government will invest up to $1.5 billion to drive the roll-out of a ‘fibre to the home’ ultra-fast broadband network. … “National’s medium to long-term vision is for a fibre connection to almost every home, supported by satellite and mobile solutions where it makes sense.

“Our initial aim is to ensure the accelerated roll-out of fibre right to the home of 75% of New Zealanders. In the first six years, priority will be given to business premises, schools, health facilities, and the first tranche of homes.

Sadly, National’s costings for this promise were drivel:

A study commissioned by the Treasury has warned it would cost between $5.3 billion and $10.4b to connect three-quarters of New Zealand homes with fibre-optic cable using the Government’s preferred active Ethernet technology.

Former Telecom chief technology officer Murray Milner, who carried out the study, says the $1.5 billion the Government has allocated to its ultrafast broadband plan would not be sufficient to connect that number of homes. That is even if matching investment from the private sector was forthcoming and cheaper, “passive” fibre technology was used.

And so the back-peddling began. Now in the aftermath of the Fry-inspired focus on the issue, the Nats are trying to put a brave face on it:

British actor Stephen Fry’s criticism of New Zealand’s broadband does not appear to have the Government too abashed, with Communications and Information Technology Minister Amy Adams today boasting about the “excellent progress” made in the last three years. …

Ms Adams said contracts had been locked in, the rollout was under way, and competitive wholesale prices had been secured, but it was up to the industry to ensure New Zealanders got the quality and performance they expected at prices they could afford.

“Government can help but it is industry that ultimately carries responsibility for delivery of faster broadband in the marketplace in an attractive way.” …

Prime Minister John Key yesterday defended the network. … The Government has set aside $1.5 billion for ultra-fast broadband, and aims to have the service reaching 75 per cent of New Zealand in the next 10 years.

Notice how we’ve gone from 2008 promises of the government providing broadband nirvana within six years to the 2012 reality of it’s up to “industry” within ten years. Notice how we’ve gone from “right to the home of 75% of New Zealanders” to “75 per cent of New Zealand” (whatever that means). And if you want the real detail on how vacuous those National election promises were, go read Chris Barton’s “Telecom’s new monopoly” – “We now know that it’s a promise that’s not only broken, it’s shattered”.

64 comments on “Fry puts heat on broadband”

  1. shorts 1

    http://dl.dropbox.com/u/7491380/nz-internet.png

    a very good remix of a cartoon doe the rounds showing our NZ reality in regards to the net and copyrighted material

    depending on where you are our broadband isn’t ‘too bad’… our ISP’s charges compared to similar countries as our own is very sobering and hard on the pocket

    • happynz 1.1

      Excellent comic! :)

      Yeah, it’s funny how the ‘news’ broadcasters come out with all sorts of crap along the lines of ‘well, he went over the cap, so his speeds were throttled back…so, actually, relative to other countries, our internet is the best in the world…’

    • Well, that’s more about the problems of disparate copyright laws that slow down expansion of internet-based media services from the USA. It would be a good reason to have an international copyright treaty that would allow people to internationalise licences to some degree- IF the one we were getting wasn’t as terrible as ACTA.

  2. mikesh 2

    If the deal is as good for Chorus as Barton (and Roger Douglas) implies then government will receive a healthy return from the consequential tax receipts.

    • tc 2.1

      You’ll find after depreciation, provisions, blown out costs and highly paid senior managers that’s very unlikely

  3. ianmac 3

    We must trust them though. They promised multiple times that they would have the books balanced by 2014,…… unless something Michael Cullen did way back gives an excuse to flunk it.
    Trust them? You sure can.

  4. Yankdownunder 4

    Stephen Frye had come up against something so illogical, that he’d not considered that there would be a “data cap”, as that is an archaic and obsolete method [one that Telecom still uses]. So, he can be forgiven for not knowing this fine point in the contractual agreement.
    NZ broadband, even with a lifted cap, does everything that Mr Frye says; drops out with out warning, slows to a crawl, and is very expensive.
    Even after the fibre optic roll out, it is estimated that NZ will be be 5 years behind technical development. NZ already pays more “than most” for an arguably below average system.
    I found it amusing that Telecom’s solution to the problem was “pay more money”. That is something that all New Zealanders have heard and unfortunately have no recourse against.

    • insider 4.1

      So the alternative to pay more is what? MAgic? Wishful thinking?

      • Tigger 4.1.1

        The alternative is a quality system, which is what the Nats promised but will not deliver.

        Pay more is BS of course. Our service here is shite and shite, no matter how Telecom talk it up, is still shite.

        • insider 4.1.1.1

          So how would you deliver this ‘quality system’ and how much will you charge?

          • mik e 4.1.1.1.1

            outsider just another broken promise from National.Korea has had high speed broadband for nearly 10 years .national has taken nearly 4 years to let a couple of small tenders.National are merely delaying to save money and also reinstating monopolies that took nearly 20 year to devolve.So in the end National are doing what they do best making wild promises they can.t deliver business as usual protect free market monopolies and cartels!

    • Actually data caps, and slowdowns or extra charges for exceeding them, are an entirely reasonable way to differentiate fees for people at home using the internet with data-intensive activities all day and people who have other things to do. (or just read text rather than downloading/streaming music or movies, or playing games online) The problem is that we pay too much for too little data at speeds that aren’t really that great, and that at most ISPs they still meter bandwidth during low-traffic hours. If we paid less for what we got now, and the low-traffic hours for each ISP were unmetered, then I’d be quite happy with data caps.

  5. Roy 5

    While I agree with Stephen Fry that NZ broadband is of a poor standard, I think we have far more serious issues to deal with before we get around to dealing with that one, like child poverty for example. It’s a pity that Stephen Fry doesn’t use his celebrity to complain about that instead.

  6. Draco T Bastard 6

    And to think, if we hadn’t sold Telecom and deregulated the infrastructure it would already have been done and it wouldn’t have cost the taxpayers a cent more than what they paid on their phone bills.

    • insider 6.1

      Really? What makes you think that that was guaranteed to be the case?

      • tc 6.1.1

        Not guaranteed but highly likely, if the network remained publicly owned with operators such as Telecom allowed to use/invest instead then up against global players on a level field.

        Using price/performance/technology rather than gattung’s infamous ‘confusion’ and monopoly tactics we’d have better/cheaper services rather than $10-15m p.a. CEO’s and a fat layer of overpaid management figuring out how to keep their priviledged position protected.

        • insider 6.1.1.1

          So similar to the electricity industry perhaps where the SOE heads earn million plus salaries and prices have escalated significantly and we have had major power failures due to failure to monitor and maintain key infrastructure, or poor oversight of operations?

          • Draco T Bastard 6.1.1.1.1

            Nope, the CEOs pay would have been kept down to realistic levels.

            What you’re actually describing is the result of the power companies becoming state corporations that had to make a profit and pay dividends rather than being a service which had to re-invest into the network.

            • Colonial Viper 6.1.1.1.1.1

              rather than being a service which had to re-invest into the network.

              …and achieve social good with their delivery of power, not just profit maximisation.

          • mik e 6.1.1.1.2

            Outsider the only power failure of any significance was when the free market couldn’t deliver. The late 90s Auckland was without power for 3 months due to mad max bradford and National.
            Pete Hodgeson saved the free market by building a jet turbine Generator to meet the short fall because of drought . Not run down infrastructure that national neglected.
            Outsider get you BS right or it come back to hit you in the face.
            National is a do nothing except Spin BS so its understandable!

            • insider 6.1.1.1.2.1

              Mike you must have missed the ‘rusty shackle’ failure at Otahuhu substation in 2006 and the Newmarket transfprmer maintenance outage overload failure in 2008 both of which were described at the time as major and I believe even appeared in the newspapers.

              the 98 failure was entirely due to lack of monitoiring and maintenance by a council controlled entity over many years. I suggest you read the commission of enqiry report

              • mik e

                2 days is not 3 months.
                The commission report put the blame on no over all plan for electricity since deregulation under National .Transpower had no plan to maintain national grid.

                • insider

                  you really don;t have a bloody clue do you? Transpower had absolutely no role in the 98 failure. It was purely a local lines problem due to a lack of managment

      • Draco T Bastard 6.1.2

        The difference between the full profits being re-invested into the network (state owned) and 15% of profits being re-invested (private ownership).

        • insider 6.1.2.1

          Are there any examples in NZ or elsewhere where that has been successful in providing a low cost but technologically advanced/high level of service infrastructure?

          • Colonial Viper 6.1.2.1.1

            A government has to back it as a social good and provide massive assistance in making it happen eg South Korea.

            • insider 6.1.2.1.1.1

              Isn’t that what the govt (agree with it or not) is sort of doing here with UFB? Or are you saying the networks in RSK are run on a not for profit basis – which is what Draco is effectively calling for. That doesn’t sound like the corporatist Korea I’ve heard of.

              • mik e

                outsider South Korea plans its economy opposite of National who only plan their spin through an yellow press!

                • Colonial Viper

                  Surely the free market will make the best economic decisions for NZ today, for the best economic outcome for all of us for 10 years time.

                  Or not.

          • Draco T Bastard 6.1.2.1.2

            Yes, NZ before the sale of Telecom. There’s also the history to prove that competition in infrastructure doesn’t work.

            Quite simply, we wouldn’t have the network we have today if the government hadn’t built it.

            • insider 6.1.2.1.2.1

              You can’t seriously be saying the post office was an example of a high level of service. How well do other non corporate govt entities do on service?

              Inicdentally, I’ve heard from Telecom engineers that the approach taken pre corporatisation to dispersed NEC-based exchanges on rather than centralised switches has really hamstrung the development of IP and smart network systems in NZ (why was a bit beyond my technical payscale – I think it was to do with the complexity of progamming hundreds of exchanges rather than a single switch, and that made them vulnerable to new entrants like Telstra and Vf who could build new). So govt entities like private are not all seeing and not guaranteed to succeed.

              • Vicky32

                You can’t seriously be saying the post office was an example of a high level of service.

                It actually was! I am amused that you repeat the ACT belief that it wasn’t. I remember old Mad Dog Prebs saying years ago, that pre-sale, it took 6 weeks to get a phone, and the only colour available was black. How he expected to be believed in 1991, saying that, when people would have remembered  (and did) remember, that what he claimed was not the case, amuses me greatly.

                • insider

                  Ours was grey. Perhaps he exaggerated for effect….

                  I remember seeing touch phones in US tv programmes in the early 70s. We didn’t get them in NZ until well into the 80s whcih to me is a practical example of how far behind we were technologically.

                  But what’s the bets the post office never measured customer sat, response times etc. Why bother when you have a god given monopoly?

                  • Vicky32

                    Ours was grey. Perhaps he exaggerated for effect….

                    Exaggerated? Are you an ACToid? He lied! Ours in Rotorua, was cream, and in Wellington, puke green (both before the sale of Telecom to the septics.) As for the ‘6 week’ lie, I had had a phone connected in 1984, three years before the sale, in 24 hours. The most impressive part of the above, is that we had nice modern (for the time) phones in Rotorua in the 1960s, despite the poisons that corrupted equipment – I can’t imagine the filth doing that! (“Hey, Abner, t’ain’t no profit in that there hick town”)

                    But what’s the bets the post office never measured customer sat, response times etc.

                    Why should they have? Back then (at the time we’re talking about) the Post orifice was about service, not profit. The only people who bleat and moan about the service are 20-something business school students who are repeating what they heard Daddy quoting Prebs and Ruth Richardson say – because they weren’t alive at the time, and ACToids who have edited their own memories! :D

                    • felix

                      Too right Vicky, I happen to own a number of phones from the era in a variety of colours. (Ours was green.)

                      Prebble is a bald-face liar and insider is a naive rube for believing him.

                  • Draco T Bastard

                    We didn’t get them in NZ until well into the 80s whcih to me is a practical example of how far behind we were technologically.

                    Would have preferred it if they’d totally bankrupted the country instead?

                    To have touch tone phones required changing the old analogue exchanges with the new digital ones that were put in during the 1980s/90s (most were done in the 1980s BTW).

                    The time it took to get connected was determined by several things not least of which was:
                    1) The infrastructure that was already in place – it’s a little difficult to connect a phone when the nearest cable is 10km distant
                    2) When someone was available to do the work (despite the hyperbole going round we really weren’t sitting on our duffs smoking). Old analogue remember – phones had to be physically connected and disconnected. Whakamaru, which was 50km+ from the Telecom depot in Tokoroa got a scheduled run about once a month – making such a long run out just to connect one phone wouldn’t be particularly efficient – but in Tokoroa connections within a week were normal

                    Service to most customers was fine and people actually understood the physical limitations. This last has been forgotten/lost over the last three decades.

                    • jbc

                      I think there’s something else that has been forgotten: the attitudes of Telecom staff when it was a govt service. They took a while to shake.

                      I worked there as a contractor in 1991 and could not believe how they worked. The single most important thing was getting to the end of the day with your mandatory tea breaks fulfilled. Solving real technical problems: “are you crazy?” “Who’s side are you on?”… etc. I was often forcefully dragged away from my keyboard to Krispies and milky tea – even when deep in troubleshooting a problem affecting customers – because working through tea break was not setting a good example.

                      [Yes, I understand there are two sides to that situation. Both dinosaurs.]

                      I was treated well by everyone only because I was seen as naive (and I was naive).

                      The attitude of ‘doing as little as possible’ seems to pervade telecommunications providers generally, especially the ex-govt-owned ones. That is part of the problem with broadband in NZ. Telco competition is trench warfare (from positions entrenched in concrete) rather than innovative. The instinct is to dig deeper.

                      Very few countries have shaken this completely, only the ones where the trenches have been exposed by ground penetrating munitions from non-telco competition, or there is some other motive to be the best. That has not yet happened yet in NZ.

                      I’m hopeful, but not confident, that the broadband initiative will help. Lowering the cost of access to customer is one thing, the other is the conglomerate that owns Southern Cross.

                    • I don’t know if the possibly lax work culture is really the problem so much as blatant profiteering, to be honest, but neither really help.

                    • jbc

                      “I don’t know if the possibly lax work culture is really the problem so much as blatant profiteering, to be honest, but neither really help.”

                      I think they are closely related in human nature. Both involve taking as much as possible while minimizing effort.

                      Until there is both a real viable alternative for international access together with non-discriminatory access to customers then the profiteers will win.

                      If both sides are competitive then it will get very interesting.

                    • Colonial Viper

                      Thats all bullshit

                      You are avoiding the fact that the de facto policy of the public sector in the 1970’s was to lower unemployment by making jobs for people. The public sector wasnt there to maximise profits it was there to provide a social good.

                      Of course if you want to go to a private sector model and maximise profits you would lay a lot of people off (reduce “waste” – since these workers are clearly “waste”) and let unemployment double triple and quadruple from the previous accepted maximums for unemployment of 1.5% to 2.0%

                      Oh yeah thats exactly what we let happen.

                      Looks like the most “efficient” economy is one which doesnt need many NZ workers. Guess how thats going to work out for us long term.

                    • jbc

                      All bullshit? I’ve worked in and around telcos for 20 years and have forgotten more than I remember. My experience at Telecom’s Airedale St Exchange is not one that I will forget.

                      The desire to employ is not incompatible with providing service. I’m in a telco now that manages both very well. I liked my 100Mb/s Internet so much I joined this company.

                      I never said that the guys I worked with we’re waste, but rather that they were clearly not much interested in delivering or improving service. Privatization did not change that much, but it did add the profit twist.

                      Most telcos behave that way overall too. Collect money from subscribers while doing as little as possible. Gattung”s cynical confusion strategy a prime example.

              • mik e

                More BS insider Telecon had years of high profit monopoly to improve its infra stucture but chose to send the money overseas to its share holders.Those exchanges with the NEC switching gear in them were the for front of technology at the time they were installed .
                Telecon has been the big bully on the block now there facing real competition they are faltering.

              • Draco T Bastard

                The Post Office, not so much. Neither was Post Bank but Telecom was making huge surpluses before any of the mid to late 1980s reforms hit and all that surplus was being used in upgrading the network.

                I’ve heard from Telecom engineers that the approach taken pre corporatisation to dispersed NEC-based exchanges on rather than centralised switches has really hamstrung the development of IP and smart network systems in NZ…

                Telcos don’t innovate – they use the technology produced by the tech companies (Motorola, Lucent, IBM, etc) available at the time. Would have preferred that NZ stay as an analogue, human based switching network instead? It certainly would have increased job availability.

                Also, that line of logic makes no sense in regards to the decentralised nature of modern networks which leads me to believe that the engineer you were speaking to was talking out his arse.

                • insider

                  Well I’d suggest you are making generalised assumptions about networks in 2012 and he was talking about specific issues to do with the capacity of Telecom’s network to competitively roll out smart network in the mid 1990s compared to that of Telstra or Vf. Given it was his job to understand that kind of thing, I’d respectfully suggest there was slightly more chance of your arse being the one doing the talking.

                  As for telcos not innovating, you’ve obviously never heard of Bell Labs…

                  • Draco T Bastard

                    Ah, you’re talking 1990s which was when Telecom was still putting in the digital infrastructure that was planned for in the 1980s. Changing technology etc etc.

                    As for telcos not innovating, you’ve obviously never heard of Bell Labs…

                    I suspect you’ll find your answer in the name, specifically, it’s not Bell Atlantic or Pacific (or whatever their telco name was).

                  • mik e

                    outsidere TelecoN was a private highly profitable Monopolistic company during the 90s .
                    Short term quick buck mentality 3 month balance sheet reporting to the share market encourages this behaviour of under investment by private companies. Ridiculus salaries and bonuses for CEO’s and board members also leads to this quick buck management Style, Chicargo cult economics!

                  • Colonial Viper

                    As for telcos not innovating, you’ve obviously never heard of Bell Labs…

                    Was that the 100% US government owned and publicly funded Bell Labs you are referring too?

                    Tell me, what new innovative shit has the privatised profit seeking carcass of Bell Labs managed to produce in the last 20 years?

                    • insider

                      No the bell labs that were started by AG Bell and part of AT&T for most of its life, now Alcatel Lucent. Five nobel prizes mostly in physics in the last 25 years seems a reasonable contribution to science.

                  • mik e

                    So how come bell labs didn’t get the job of upgrading telecon prior to sale. NEC one the tender and besides that’s your argument would imply that telecom should have been innovative which is utter BS capacity to manufacture and develop such equipment doesn’t exist in NZ.Telecom had large enough profits to upgrade and modernise but didn’t.

      • Vicky32 6.1.3

        Really? What makes you think that that was guaranteed to be the case?

        Telecom! They are shite pure and simple (for instance, I have been trying to get to the bottom of nuisance calls for 10 days now – their csrs just tell me that for reasons of  ‘confidentialityness’ (yes, she really didn’t know the word confidentiality), she’d lose her job if she told me who was harassing me!
        If we ever  get good broadband, a huge chunk of people will still not be able to afford it.

        • insider 6.1.3.1

          To counter that I have all my services with them adn I think they are very very good. I got a free $50 credit when switching mobiles even though I wasn’t precisely eligible. They doubled my bb cap and are offering a $5 reduction monthly just for saying I’ll stay 12 months with them. On the rare occassion there has been a network issue they’ve rereouted calls to my mobile for free. Everyone has a different story and none of them reflect the full story.

          There is a specialist malicious call centre you can call if you have a problem. I suspect she is right over the confidentialityness…if not right ovr the grammar

          Yes it would be wonderful to have the bb they have in other countries, but do you want all the other things that go with those countries that allow them to deliver that service? Population density is a huge issue for NZ in terms of cost. We get far fewer customers per km of cable, so same capital requirements if not more, but far fewer revenue opportunities.

          • tc 6.1.3.1.1

            You still have to go on a waiting list to get a phone on parts of the nth shore in akl and in rural areas.
            Rural’s been handed back to telecom on a plate by Joyce so wonder how that brighter telco future will go for farming kids needing decent broadband for remote schooling or researching homework…….very nicely for telecoms bottom line thanks to jackboot Joyce.

          • Vicky32 6.1.3.1.2

            There is a specialist malicious call centre you can call if you have a problem. I suspect she is right over the confidentialityness…if not right ovr the grammar

            Ma dai, that’s who I was talking to! A female with that specialist call centre. I am sure she’s right as well, about the confidentiality – someone had let slip that the calls were coming from a business. So, what we have is, confidentiality for business, beneficiary customers get f****ed…

            • insider 6.1.3.1.2.1

              So if she was right, why are you blaming Telecom? have you considered that is an issue to do with the law (be it privacy law or telco law) and not Telecom’s fault? I think TC administer the service for the whole industry. If the calls were coming from a vodafone customer, wouldn;t it be their fault?

          • mik e 6.1.3.1.3

            Its more important than building overpriced motorways given the price of oil is going up rapidly from now on.
            east Asian school children are out performing us at education because they have invested heavily in a modern broadband .
            While Key and co sit on their hands.

        • starlight 6.1.3.2

          I had that problem of those sort of calls too with telecom,state your case,tell them
          in no uncertain terms you are sick of it and you want to know where the calls are comming
          from,they can do it,i done it,and because of it got my phone number changed free of charge
          and also made it confidential,but that was a battle too,their teckies mucked it up a few times.

      • mik e 6.1.4

        Insider central planning the electricity market was always ahead of demand under the govt.
        Telephone systems were always kept up to date when it was government owned until Roger Douglas had his way deliberately making it dysfunctional + spending $2 billion on an upgrade just to sell it off as a guaranteed monopoly who’s shareholders shared windfall profits while telecoN put prices up by over 400% because there was no competition.TelecoN hardly spent a cent on infrastructure during that time,Only when faced with competition did it upgrade.Since its faced competition its profits and share price have dwindled into the doledrums .
        Now national are handing out corporate welfare to the tune of $ 1.5 billion and putting telecon back in a monopolistic position so they can rorte us again!

  7. JonL 7

    NZ broadband is ok – when it’s working! – which is not very often. The pricing schemes, however, and the use of data caps, like Australia, firmly mire it in the exploitation zone! Mates in Japan, the USA and Europe laugh, when you mention data caps and pricing schemes!

    • insider 7.1

      I similarly laugh at my overseas friends when they talk about paying congestion charges on roads, paying for local phone calls, paying to access beaches and compulsory service charges in restaurants.

      • Colonial Viper 7.1.1

        you don’t fancy moving to one of those more capitalist, privatised countries?

        • insider 7.1.1.1

          I’ve lived in some and they aer all fine in their way. But they are different. They have as much laughable about them as we have here, despite the fine qualities of their internet services. Swings and roundabouts

          • mik e 7.1.1.1.1

            Ultra Slow Roll Out of UFB
            Re Monopolising the communications industry.
            Dumb and Dumber from National!

  8. MrSmith 8

    I advised my friends to buy Telecom shares when this deal was going through as it was nothing but a tax payer rort.

    It will be interesting to see how many National party members have brought shares recently or own shares in telecom, my guess is plenty.

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    6 days ago
  • Redcliffs School closure plan wrong
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    6 days ago
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    1 week ago
  • World water day: eight rivers in one day
    Our photo journey started by the Waioweka (also known as Waioeka) River which flows from Te Urewera to Opotiki, and is surrounded by beautiful forest. The water looked great! Kopeopeo Canal It contrasted greatly with the Kopeopeo Canal near Whakatane,… ...
    GreensBy Catherine Delahunty MP
    1 week ago
  • Council can stop Port’s encroachment on harbour
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    GreensBy Catherine Delahunty MP
    1 week ago
  • Big change starts small
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    GreensBy Denise Roche MP
    1 week ago
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    GreensBy Kennedy Graham MP
    1 week ago
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    GreensBy Russel Norman MP
    2 weeks ago
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    GreensBy David Clendon MP
    2 weeks ago
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    GreensBy Jan Logie MP
    2 weeks ago
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    GreensBy Denise Roche MP
    2 weeks ago
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    GreensBy Eugenie Sage MP
    2 weeks ago
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    GreensBy Gareth Hughes MP
    3 weeks ago

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