Ross Patterson, Telecommunications Commissioner, said:
The intention of the study has always been to identify factors which might slow down the uptake of high speed broadband by consumers and businesses so relevant parties can make informed decisions. Following feedback from interested parties, we are still seeing two main areas identified as being important to consumers – costs relating to connecting and using high speed broadband, and the availability of video-on-demand servicesThe full report is available from the Commerce Commission.
The key points that have emerged in the course of this study are:
- The costs related to connecting to the network, and using high speed broadband services, have been identified by many parties during our study as a critical factor. As these costs (non standard connections, re-wiring, upgrading equipment and subscribing to the services) appear to be significant, they are likely to reduce the initial uptake of high speed broadband services for both consumers and SMEs.
- Video content is likely to be the primary driver of consumers’ uptake of high speed broadband services over the next few years. The rate of uptake is likely to be higher if there is a diverse range of video on demand options available to consumers. Currently, there are limited online video on demand services in New Zealand compared with many other comparable countries.
- Potential issues relating to data caps, backhaul capacity and IP interconnection are likely to be resolved by market forces.
- Rural users have the same appetite for fast broadband as urban users, but have a more fundamental need, which is to be connected to basic broadband. Theyare concerned that they could be left behind as New Zealand moves forward with high speed broadband services. This issue has been recognised in the RBI initiative and in the five point government action plan for faster broadband.
- In this report the Commission identifies issues related to the uptake of high speed broadband services. Where these issues are currently being considered or planned to be considered by other parties as part of their future work programmes, the Commission has stated so in this report.
- In submissions received on the draft report, some parties commented that the Commission was not explicit about what actions should be taken by which external parties, or that the Commission did not make specific recommendations. Policy decisions and regulatory recommendations fall outside the Commission’s jurisdiction under section 9A of the Telecommunications Act. The purpose of the report is to raise public awareness of the issues, to enable the relevant parties to make informed decisions.
- The Commission notes that submissions made by some parties commented on the need for this report to be updated in the future, and for the need to be more specific about the Commission’s monitoring processes.
- The Commission is currently reviewing its monitoring strategy and will take into account all the submissions received during the study in redesigning its future monitoring programme. The revised programme will include the monitoring of the rate of uptake of UFB services, changes in data caps, and the range and price of services offered over UFB. The Commission will consult on the scope and regularity of the monitoring reports.