Roadside cabinets focus of telco war

Telecom's Mike Schwalger says the roadside boxes don't have much room for competitors' equipment. Picture / Paul Estcourt

Mike Schwalger stands beside what looks like a computer of 20 years ago - or perhaps a miniature electricity substation.

But that box is where the telecommunications war in New Zealand will be waged in the coming years.

Schwalger, investment planning manager at Telecom, is standing beside a roadside cabinet in central Auckland, one of 2984 around the country.

It is in these cabinets that Telecom's competitors will install their own equipment and provide their customers with broadband using Telecom's copper wire telephone lines - a result of the Government's decision this year to force Telecom to open its network to competitors.

But the success of that decision will be determined in Parliament, where the finance and expenditure select committee this week starts to examine the practical application of the Telecommunications Amendment Bill.

On Wednesday Telecom chief executive Theresa Gattung and chief financial officer Marko Bogoeivski will appear before the committee to try to protect the company's patch as much as possible from the legislation which has already wiped $2.5 billion off its share value.

Telecom's competitors will also appear, and are likely to do their best to gain access to Telecom's network on the most favourable terms. The issue of the cabinets may also arise.

Schwalger said there was not much room for competitors' equipment in the cabinets or telephone exchanges, and many were running at capacity.

"We have gone out to the industry to talk about the issues around cabinets and we are seeking input so that we can work together to deliver an industry solution," he said.

"It's not simply a case of increasing the size of the cabinets because that triggers resource consent issues."

Cabinets hold equipment to serve the households in the area. They were traditionally used for rural and remote areas but now also serve urban areas.

Just 14 per cent of Telecom's customers are connected to cabinets, but it aims to have all households connected by 2012, making it easier to provide broadband services to more people.


Telecom's Cabinets

* Cabinets are roadside boxes containing phone and internet equipment.

* 14 per cent of Telecom's customers are connected to cabinets, but that number will increase.

* Telecom says 42 of the 2984 cabinets around the country are running at full capacity.