Archived publication

This publication is no longer current or has been superseded.

Appendix 3: Telecommunications Background

Telecommunications has been the subject of a recent government stocktake and the notes that follow draw heavily on reports prepared for it.21

Telecommunications systems consist of a core network for carrying signals between locations, and access networks linking the core to individual users and customers.  In New Zealand, the core network operators are:

  • Telecom NZ Ltd has the most comprehensive network covering both long distance (core network) and local loop (access network), landline and mobile

  • TelstraClear Ltd has a core network that is most developed for inter-city traffic and mainly in the North Island, relying on access to Telecom’s local loop for connecting with most customers

  • Vodafone NZ Ltd has a nationwide mobile network covering both core and access functions

  • Broadcast Communications Ltd (BCL) has nationwide coverage, but offers only ‘wholesale’ services (bulk customers, not individuals)

  • community-based networks (eg, Smartlinx3) provide localised core network capacity, relying on inter-operability with other suppliers.

The principal technologies currently available are:

  • conventional landline (public switched telephone network) generally based on copper cable, but being progressively replaced by fibre-optic cable with greater capacity; a process that may require upgrading and perhaps re-locating existing roadside cabinets

  • cellular networks (mobile phones)

  • wireless local loops (eg, WiMax), which provide local access network through establishment of local cell sites.

The principal trends and influences on these networks come from a combination of changing technologies and service possibilities, and commercial considerations:

  • Search for Next Generation Networks capable of supporting new services is driving exploration of the practical feasibility of the different technological options.

  • Convergence in technological capabilities between:

    • fixed line and mobile services – moving to seamless interchangeability
    • voice services and data transmission
    • device convergence – consumer electronics and phone in one device
    • telecommunications and media – broadcast media and content over phone connections.
  • Move to increasing phone network capacity:

    • transmitting data as well as voice requires faster signal conveyance
    • as volume of real-time traffic increases, suppliers need to improve the quality of service to ensure end user satisfaction and maintain market share in the face of increased competition from proliferation of services
    • increasing use of fibre connections to improve digital data capacity leads to moving fibre closer to consumers, and to the need for more roadside cabinets.
  • Content bottleneck may slow down some service offerings:

    • in New Zealand, Sky has a dominant position with multiple outlets (free to air and pay TV) and purchasing power to acquire breadth and quality of content.
  • Commercial considerations include:

    • declining revenue from fixed line voice services in low traffic density areas, due to substitution by mobile telephony and voice over internet protocol services
    • uncertainty over regulation (eg, unbundling) raises questions about the future value of investments in improving the network
    • uncertainty over the value of content-based services for telecommunications carriers may slow down the upgrade of infrastructure to provide such services
    • in low density areas landline development may be less viable than cellular or other wireless technology
    • landline is likely to remain competitive in metropolitan areas, but the need to support more services and increase capacity is likely to require both upgrade of existing roadside facilities and extension of such facilities into new areas.

There appear to be therefore a number of current influences pointing to the upgrade of facilities, including fibre-to-home and fibre-to-node upgrades of the local loop and development of wireless local loop.  All imply moving electronic control systems closer to the customer and more roadside cabinets and associated works.

21 Azimuth Consulting Limited, 2006 and Network Strategies Limited, 2006

 

|