NZ slow in race for online speed

By PETER GRIFFIN

New Zealand is slipping further behind in the global race to extend high-speed internet access.

A report by the Organisation for Economic Co-operation and Development (OECD) ranked New Zealand 20th out of the 30 OECD countries in terms of broadband penetration - down from 17th place in a report last December.

New Zealand had 16,000 DSL (digital subscriber line) subscribers and 1267 cable modem subscribers by June, the report said.

This equated to a penetration rate of 0.45 per cent.

Telecom's DSL subscriber base has increased to 24,000 since the report.

That puts the country between Spain and Italy in the rankings, but a couple of spots above Britain and well ahead of Ireland, which is in 27th place.

At face value, Telecom's DSL pricing compares well to other OECD nations.

But the 400MB (megabyte) and 600MB download caps on Telecom's high-speed JetStream services are among the most restrictive in the OECD.

"It is the pricing of high speed internet access that is still not attractive to the mass market," the report said.

Telecom spokesman Andrew Bristol would not comment on the OECD's suggestion that price was the main point holding back broadband.

But Telecom is believed to be reviewing its JetStream pricing.

Mr Bristol said New Zealand's low population densities, geography, and "distance from major information sources" largely determined the pricing and commercial viability of broadband services.

Ernie Newman, chairman of the Telecommunications Users Association said Telecom's approach to broadband so far had been "minimalistic".

"If Telecom is merely paying lip service to the whole internet age, then this country is in deep trouble, especially as competition appears to be dissipating," he said.

Australia also dropped three places in the rankings, to 16th. In June, Australia had 27,000 DSL customers and 85,000 cable customers. Telstra aims to have one million broadband customers by June 2005.

The report said Australia showed that the spread of broadband had kept step with the growth of competition.

Telstra's high-speed cable modem service did not take off until Optus entered the market with competitive pricing and unlimited access plans, it said.

Korea again had the highest broadband penetration at 13.91 per cent.

In the first six months of this year, Korean telecommunications companies added 1.4 million DSL subscribers and 750,000 cable TV customers.

"For countries that want to be among the leaders, projections and performance on the rollout of high speed internet access are likely to be measured against Korean benchmarks for the next several years," the report said.

It attributes Korea's broadband growth to "the high level of competition between different infrastructure providers".

Canada, Sweden and the USA ranked after Korea.

* The OECD report, The Development of Broadband in OECD Countries, is available online.