Big dig to start by year's end

Photo / Thinkstock

As Crown Fibre Holdings weighs up 14 short-listed bids for a share of the ultra-fast broadband (UFB) network, it said yesterday it was ready to negotiate with contenders in three regions.

They are NorthPower, the Central North Island Fibre Consortium and Alpine Energy, which are bidding to lay optical fibre in the Whangarei area, several Waikato, Bay of Plenty and Taranaki centres, and Timaru, respectively.

By next month, Communications and Information Technology Minister Steven Joyce expects Crown Fibre Holdings' full list of preferred partners for the 33 population areas for which bids were sought.

"I look forward ... to seeing the first deployments commencing before the end of the year," Joyce said in a statement yesterday.

CFH's preferences to date appear to dash any hopes Telecom had of being the Government's UFB partner for the whole country.

Telecom is so eager to play a part in the $1.5 billion broadband bonanza that, to stay within bidder rules, it has outlined a proposal to CFH to separate itself into two companies.

The UFB objective is to deliver internet download speeds of at least 100Mbit/s, and uploads of at least 50Mbit/s, to three-quarters of the population within a decade of when the Government was formed. Those speeds are up to 50 times faster than today's typical broadband services.

Bidders will have to fork out to set up Local Fibre Companies where their bids are successful, and invest in the network as customers connect.

For its money, the Government wants to see affordable services, a "significant contribution to economic growth" and avoidance of both "lining the pockets" of existing broadband providers and of duplicating their networks.

Rural New Zealand will also see some Government largesse, in the form of a $300 million commitment to provide 5Mbit/s or better broadband to 97 per cent of the country, and at least 1Mbit/s for the rest.

Late last month Joyce said bidders for rural services would have to be able to cover the whole country, a decision seen as a blow for regional network owners.

"The regional plan has been set back, there's no question about that," says TUANZ head Ernie Newman. But he doesn't see that as having any bearing on the UFB divvy-up.

"At this point I see nothing about Crown Fibre that it's not on track, so I'm guardedly optimistic that everything is okay," says Newman.