Labours ICT policy pt2...

I've just got back from a press conference at parliament where David Cunliffe & Clare Curran launched the second part of their ICT policy. The first bit was done a couple of weeks ago at Nethui, my thoughts are here.

As an outsider it was fascinating to watch the 'gallery' in action and quite a contrast from the Nethui launch.

Today's launch dealt with 3 areas, connectivity, digital divide and on-line rights.

Both Cunliffe and Curran showed the depth that comes from one being a former ICT minister and the other having had 6 years to grow in the ICT spokespersons role. Cunliffe dealt with the big picture stuff, a deep review of the whole UFB project, including CFH, the LFC's and what can be done about the copper transition.

We're also being promised what should be the final review of the Telco Act, this would be welcome and then focus shifted to the RBI. I've recently outlined TUANZ's view of things rural and there's some interesting discussion going on over at the NBR..

Labour recognise that rural is far from solved and as well as the inevitable review are also looking at fostering innovation in rural connectivity with a $9.6M contestable fund. They also support more competition in international connectivity and talk about a cable from Southland to Australia.

On the digital divide, they tackle the role of Local government and want to get the 20% of households with no broadband on-line. Again hard to fault and the devil will be in the details.

On on-line rights its basically less spying, legal access to content and a civilised approach to copyright.

All in all I'd give this one an A-, as one industry attendee said 'Clare has obviously been listening to a lot of people'

I now await the National Party policy with interest, I hope i get invited to their launch.

The real big game continues...

Readers of this blog will remember the so called 'Copper Tax' campaign from the end of last year. Things may have seemed a little quiet on that front lately, but behind the scenes there's quite a bit going on.

The latest skirmish to surface burst onto the scene with a press release from the Commerce Commission, then the story has started to grow, CallPlus have come out and shared their submission and the Telecom view is out there too.

The InternetNZ submission is now online here, the legal opinion by Michael Wigley is worth a read as it takes the issue apart in a clear logical sequence.

Its interesting that the issue is seen as a Telecom complaint to the commission as it is wider than that and pretty much involves everybody except Chorus including InternetNZ, Consumer NZ & TUANZ.

At stake is the integrity of our regulatory system and the future of copper (DSL) based broadband in New Zealand along with quite a few global trends as well.

It's easy to get bogged down at this point in a veritable alphabet soup of 3 letter acronyms and deep interpretations of the Telco Act, so here's my 'idiots guide':

The current broadband regulations set up a service called 'UBA' or 'Unbundled Bitstream Access' which specifies the price and performance of the 'DSL' services that Chorus are required to provide to retailers (what we used to call Telco's and ISP's).

Chorus has had 3 years to get ready for a change from 'retail minus' to 'cost plus' pricing for this service. The Comcom has set a new price for UBA which will come into effect on 1 December 2014.

This 'interim' price is substantially lower than the current price and will punch a big hole in Chorus revenues. Chorus are understandably not happy about this and have been trying a number of strategies to reverse this situation. I won't go into all this now but its important to keep this in mind whenever you see anything about Chorus in the news.

In an attempt to use what they see as a 'get out of jail free' card, Chorus want to use a loophole in the act to launch some new copper services that because of their innovation and the investment involved are outside of the act and can be prices in binding contracts between Chorus and the individual retailers.

It is now well established that real 'killer app' for all forms of fast broadband is on-line video, it started with the growing popularity of YouTube and now extends to iTunes, Quickflix, Netflix etc and is the new battleground.

Telecom (soon to be Spark) have announced they are launching a service called 'Lightbox', CallPlus are going hard with their geoblock avoiding 'global mode' and of course Vodafone already have a strong relationship with SKY.

Google have recently certified a number of RSP's as being good enough to receive their 'HD Verified' status (remember who owns YouTube). Video is seen as driving future broadband demand and traffic growth.

So along come Chorus with a special video optimised service called 'Boost HD' which will be specially tailored to deliver 'HD' video content. Sounds great doesn't it ? the hitch comes when the retailers get the details on HD and quickly learn that it will be priced like todays UBA services, that its performance will increase as investments in the core network come on-line (investments also necessary to meet growing UFB traffic) and because Chorus consider this to be a new and innovative service it would no longer fall under the Commerce Commission's oversight.

But wait there's more, Chorus are also proposing that their regulated legacy UBA services, the ones that get cheaper at 1 December and may get even cheaper after the current FPP (Final pricing Principle) process (which Chorus asked for) has been concluded, will essentially be frozen in time at current speeds and they won't enjoy the benefits of future network upgrades only the 'commercial' Boost HD services will.

From a Chorus perspective this all looks pretty good, dodge the regulatory bullet, preserve current copper revenues and get to sound like a player in the booming broadband video space.

However, from the retailers perspective it looks a bit different, they feel it is Chorus trying to abuse the act to in effect get them to 'contract out of the law', that Boost HD is simply a continuation of network upgrades that were planned back in Telecom days and that have been getting rolled out progressively anyway until now. And finally they see Chorus wanting to effectively degrade the regulated service that has actually worked remarkably well in improving the urban broadband experience for most New Zealanders.

At its root this issue comes down to money, Chorus want to restore their financial position and get back on track with their investors, this weeks CFH deal is part of that strategy as well. The retailers also want the best services at the lowest prices and see the current Comcom IPP & FPP processes delivering that.

The users groups, ourselves, InternetNZ & Consumer NZ want to see the savings passed onto the consumer and we are committed to preserving the integrity of our current regulatory system because it is actually working.

TUANZ has invested a lot of time and effort in getting the NZ telecommunications market to its current structure, we have a robust regulator and strong multi-stakeholder processes. Boost HD could see an end to all that and it would be a return to the dark old days.

This really is the big game in town.

We've become used to good news

Sometimes reality can bite, and that looks to be the case with the latest TrueNet report on rural broadband, which has actually seen real world performance of rural broadband connections decline.

This is surprising because a review of the RBI spin machine leads you to believe that its all sorted, the problem is that it isn't and it won't be sorted for quite a while.

The reason is simple NZ is a really awkward shape from an engineering perspective and farmers choose to live in strange and remote places. Getting adequate services to them is hard and the business models are ugly if you take the traditional approach (especially if you want a telco style return on capital in 5 years).

The other problem is that many urban technologies aren't a good fit beyond relatively densely settled horticultural districts or compact Waikato style dairy farms. DSL performance degrades over distance and even the fasters xDSL's run out of puff about 1km or so from the cabinet.

And its not really very economic to deploy 1 cabinet per subscriber and even then a lot of farms have long driveways. Farmers basically have 2 needs, reliable broadband to connect increasingly sophisticated farming operations to the world and ubiquitous mobile coverage, mainly voice but with a bit of data thrown in.

The TrueNet survey confirms that despite the hype, things aren't getting better for most rural users, in fact they can look forward to them getting worse, with ageing copper infrastructure, a cash-strapped Chorus and no ongoing TSO beyond the end of the RBI.

More and better data would be great, TrueNet want more rural probes and their are also many rural subscribers either on the Farmside satellite network or using local wireless operators like inspire.net or AmuriNet (I was a happy user of The Pacific.net when I was back living in rural Marlborough) who don't really show up in these results.

4G fixed wireless will help enormously, but it will have to be competitively priced with realistic data caps, but ultimately I still believe the answer has to be fibre to the farm.

It can (& has been) done, but it requires out of the box thinking, an acceptance of a degree of self reliance along with a community based funding, build and ownership model - a bit like Northpower are proposing now that they have some time on their hands.

A real crime story you don't want to be part of

Be afraid, be very afraid…

An active, non-pre paid telephone number, whether real or virtual, fixed or mobile is essentially a form of unlimited, unsecured credit. There really are bad guys out there probing for unsecured lines and this can bizarrely turn our telco’s into unwitting mafia debt collectors.

In the last few weeks, I’ve become aware of an issue that concerns us all but no-one seems to want to talk about in public.

And thats phone fraud, when I did the interview I’d heard about it, but thankfully I’d never been a victim of it, but on further investigation I’ve been talking to a lot of people who have been victims and its not pretty.

The sums involved can be eye watering and its happening all the time (but especially on weekends). Often the victim is completely unaware until the next bill arrives and then all hell breaks loose.

The industry are aware of the issue as it is a major pain and the TCF are working on it, but I think TUANZ has a real role to play because ultimately this is a user issue and we can help protect our members, raise media awareness and help the carriers deal with a huge problem.

If you or your company have been hacked can you let me know, I want to collect enough stories to be able to quantify the issue, find out what worked and how issues were resolved and suggest ways forward to both the TCF and the Government.

So if you want to share your story email me on chris@tuanz.org.nz or call me on 021 488 188