KEY POINTS:
The latest Commerce Commission report out on New Zealand broadband performance is generally good news for New Zealand consumers.
I'm reminded of European telco expert Ira Godovitch's comment at a telco conference in New Zealand a couple of years ago; "There has never been an example of government intervention in a telco market being followed by a decrease in investment."
The facts in New Zealand bear this out in spades. Every one of the major players is investing in their infrastructure; be it backhaul, content caching, DNS or new access technologies.
Recent announcements from Orcon, Vodafone, TelstraClear, Slingshot and Telecom all demonstrate they are committing serious amounts of money to ensure their networks can cope with the looming broadband-based future.
The less positive news is that this is leaving some of the second tier ISPs behind. Often these much smaller ISPs provide a better quality service than the bigger guys, but do so to only a few thousand customers.
They offer an important competitive alternative to the mass-market products of the big players, and often provide better customer service.
However, other data Epitiro has been gathering over the last year suggests the performance of these players, while high, is not improving as fast as that of the big players, and their bigger budgets.
Their customers are generally happier than those of the big players; the next 25 largest ISPs on average score 3.7 (out of 5) for customer satisfaction; the big five 3.3. That's quite impressive, especially when you remember 3.7 is an average over a substantially greater number of ISPs. Players such as ICONZ, Compass and WorldxChange do particularly well. It'll be interesting to see how long they can maintain that edge; I for one, certainly hope they can.
TelstraClear (TCL) has had a lot to say about its performance this year, some of which is borne out by the data. However, as the report outlines, there is a significant difference in the performance of its services, depending upon where you are located.
If you're central CBD where TCL has its own network, or are on the cable network in Christchurch and Wellington it's excellent. If you are not, it would be worth contacting TCL before signing up and checking whether you are "off-net" (the slower, resold service from Telecom) or "on-net" (the faster service provided over TCL's own network), as this will play a large part in determining the quality of your service. If you're not central CBD, it's unlikely you'll be on their better service.
As other ISPs roll out services delivered from their own equipment in Telecom's or other wholesaler's exchanges (LLU), this issue of a service delivered from an ISP's own infrastructure versus that delivered from a wholesaled service will become more important in assessing service performance.
One must also save some praise for Telecom. It is almost unrecognisable from the company it was two years ago. A combination of operational separation and new leadership has delivered a more ruthless focus on the customer, despite the enormous internal re-organisation required for operational separation, and its transformation into "NGT", or Next Generation (ie IP-based) Telecom. It's service levels are still lagging, but Epitiro's data indicates it is closing the gap.
Read the full Commerce Commission broadband report here/
Michael Cranna is managing director of Epitiro Technologies which prepared the report.
