Opinion: Why Hawke's Bay needs to tune into the 5G debate

Letting Spark and Vodafone control the 5G rollout is akin to "putting Jessie James in charge of the bank", says NOW CEO Hamish White.

5G isn't going to be making it to Hawke's Bay (and your smartphone) in any significant way in the next 2 – 3 years. Hamish White, the co-founder and CEO of Hawke's Bay-based NOW NZ Ltd, explains why you should care about the 5G debate.

Breaking through the 5G hype

Wireless (or mobile) is the way of the future and 5G is a quantum on previous generations of wireless broadband. Some are describing it like having fibre in your hand, with the speed to achieve whatever you like, from wherever you like.

For Hawke's Bay (and other regions) it's about facilitating new ways of operating businesses and ensuring we remain globally competitive, bridging social-digital divides and better enabling us to protect and manage our fragile environment.

5G will be the technology that enables Napier and Hastings to become smart cities, step-change how we manage our waterways and their quality, make telehealth accessible to all socio-economic groups, brings greater efficiency in how we operate our farms and orchards, it will be the backbone of putting driverless cars on the express-way and give birth to the next generation of the itinerant worker.

It's a game-changer for all of us, so we need to get it right.

NOW CEO Hamish White argues that regional New Zealand deserves 5G at the same time as larger urban centres.

Hawke's Bay stands to win if the government steps in now

Looking back at how fibre broadband came to be in our homes and businesses, the government of the time can take credit.

They mandated the regulation and splitting up of what was then Telecom, then governed a world-class roll-out of fibre. The result, an explosion in price competition, increased levels of service across the industry and increased innovation.

By ensuring a level playing field was in place when it came to the rollout, the government ensured the Hawke's Bay community and our businesses enjoyed the benefits of a healthy telco marketplace.

NZ's fibre network and its speeds are the envy of many a western world country, not least of which our Aussie neighbours.

So, when it comes to the 5G network rollout we could reasonably expect the government to take the same approach, ensuring the interests of the public (or in our case, the people and businesses of Hawke's Bay) were kept front and centre.

However, the reality is very different.

Our current government appears to have put 5G in the too hard basket.

The Commerce Commission completed a report on the mobile market in 2019, which concluded that there was no evidence of market failure at a wholesale level.

But much of their findings were based on a current view of what the mobile market looks like. A cornerstone to their assessment was the existence of three mobile network operators.

But to date, only two of these operators have indicated they're investing heavily in 5G.

Even if there were to be three, which is akin to having three state highways throughout New Zealand, or even three sets of power line distributors servicing our streets (which would be ludicrous), they seem to have overlooked the economics of the capital required in this next generation of telecommunications.

This is known to be between four to six times more than previous generations of mobile technology.

Three lots of infrastructure servicing a small non-densely populated country will not render the same economics as one nationwide ubiquitous network.

Investors will still want an equitable return and your average Kiwi home or business will bear the cost in their monthly plan fees.

The network operators will also only go to areas that offer the greatest return. Period.

A government-led rollout would not only ensure 5G becomes a reality for all of New Zealand's regions and the walks of life within them, but it would ensure two important growth outcomes for our economy.

The first being contestability of the roll-out, the deployment of our nationwide 5G network could be contested by infrastructure companies across New Zealand, not just our big telcos.

The second, that the network would effectively be 'open sourced' for any mobile-capable business to innovate off it (for a regulated fee), rather than have that innovation padlocked to the R&D teams of privately held telco's.

So far Vodafone and Spark have not actively engaged in a conversation that would look to emulate the fixed-line fibre (UFB) regulated sector. Neither has our Communications Minister, the Honourable Kris Faafoi.

Our government's passive approach to 5G is effectively signing off a pass to leave the rollout of in the hands of two private companies that for so long enjoyed a profit-making duopoly at the expense of everyday New Zealanders and New Zealand business.

This is akin to putting Jessie James in charge of the bank!

The digital future of our community, environment and local economy

The benefits of 5G are too great, to leave them in the hands of the private sector.

5G promises to bring high-speed internet access to anyone who has a mobile phone.

In the case of Hawke's Bay's lower socio-economic areas, 5G will help bridge the social digital divide that currently exists with fibre (customers signing up to fibre are put through a robust credit-checking process, meaning those who have struggled in the past, are disadvantaged in the future).

Not to mention the need for a home router and laptop/tablet which combined can mean a $750 outlay. A $100 prepay phone, powered by 5G breaks down this barrier immediately and gives users to super fast high performing internet.

Much has been said about how we better manage our practices when it comes to farming and horticulture.

NOW CEO Hamish White says it will take some time for 5G to significantly reach Hawke's Bay (and your smart phone) unless there is Government intervention in the rollout.

5G puts (affordable) technology in the hands of our primary sector to enable them to cost-effectively ensure the positive contribution they make to our economy and dinner table are also a positive contribution toward our environment – through monitoring water, run-off and resource consumption from a farm.

One step further, an orchard powered by 5G sensors, camera's and sophisticated software will enable our producers to optimise how they grow, monitor and sell their apples.

Imagine a world where the technology running an orchard has a live feed of predictive weather models built into it – being able to anticipate and proactively deal with a threat of hail. 5G would power the launch of drones to lift a crop cover and drop it on top of newly forming apples before the hail storm hit.

5G could enable stronger profits for our growers and farmers, connecting global buyers directly into the current outputs of a Hawke's Bay orchard. Enabling a retailer in Japan to buy, in real-time, directly from what they can see in the orchard on Pakowhai Road here in Hastings, Hawke's Bay, New Zealand.

A platform for Hawke's Bay's growing tech sector?

Hawke's Bay is increasingly seeing the benefits of a thriving tech sector. A sector that has largely been built off the back of digital connectivity and technology. Without fibre, many of our tech start-ups wouldn't exist here in Hawke's Bay.

As a sector, we will see and be part of the creation of new tech businesses here in the Hawke's Bay. These businesses will create new jobs and attract highly skilled workers to our region. Both of these developments will strengthen and continually help to diversify the Hawke's Bay economy.

A great example of this is NOW. Without fibre and a regulated broadband market, we would never have existed and become the size we are today.

We, of course, could stand to gain from a regulated 5G roll-out, but only if we can compete and offer a better alternative to the meeting the needs of consumers and businesses, it's not a given.

In a sense, any success enjoyed by NOW off the back of 5G would put more jobs and growth into our local economy that would not otherwise exist.

Without a freely available 5G network, what companies like NOW can deliver will be limited.

Another example is the digital development companies who are building applications and technology to power some of New Zealand's and the world's largest companies – think local companies like StockX, Food Locomotive, Released, FingerMark, Video production companies like Indelible and Grundy Productions – the list goes on and these businesses did not exist ten years ago.

But all this great innovation relies on one thing – 5G making it to our region.

The simple question

Why would the government not take the same approach to 5G as they did to fibre, electricity and other infrastructural assets that are the backbone of our economy?
It's a proven model, and best of all, if we create the right regulatory setting this does not even need to encumber the taxpayer.

This would observe them governing it's roll-out (while they're at it, why wouldn't they headquarter the governing body in Hawke's Bay to provide new jobs for our region?).

We cannot afford to get this wrong, we need to take another look and ask if the next playing field for mobile, will be a fair one and represent the people, homes and businesses of areas like Hawke's Bay to its fullest.

Hamish White is the CEO and co-founder of NOW - an award-winning full-service, home broadband and business digital communications provider, founded in 2012.