Rural broadband study hits major snag
Watchdog’s rules fine for the big guys, not for small Kiwi firms, writes.
Internet providers in rural and remote areas have a new challenge to add to their already-full plates of difficult-to-do stuff: regulation. The Commerce Commission is undertaking a very comprehensive Rural Connectivity Study, as part of work to monitor competition in the telecommunications market, as it is legally required to do.
“We want all New Zealanders to be able to make confident choices to stay connected in ways that fit their situation, lifestyle and business,” the commission’s telecommunications manager Ben Oakley said.
Compared with cities and towns, less is known about rural area broadband options.
“This work is focusing on demystifying what services are available, where they are offered, and who they are offered by,” Oakley said.
“We are also interested in the pricing of different technologies, the performance of them, and what the consumer experience looks like — in particular for those in rural areas who lack the choice and competition that those in urban areas have,” he added.
It is a major piece of work by the commission which, when completed, should give everyone from customers to the providers a much better picture of rural broadband than we have currently.
The problem is a lot of data needs to be gathered for the commission, and smaller providers are baulking at the effort required.
We’ll see how the connectivity study goes but further discussion around practicalities of collecting the information seems warranted. Maybe a third-party could be engaged to collect the data?
Wispas of concern
The Internet Service Providers Association of New Zealand (Ispanz) and the Wireless Internet Service Providers Association ( Wispa) are expressing concerns with the work required to provide the information.
It is mandatory under the notice issued by the commission for providers to gather the information and share it with the watchdog.
“There are significant resources required to complete once the full requests come through, the cost to operators is considerable, and comes at a time when input and business costs are already inflated,” Wispa chairman Mike Smith said.
Ispanz CEO David Haynes said one of its members estimated it would take 80 to 100 hours of internal resources to do this work. “That’s over two full working weeks for a highly skilled person with an already fulltime job in a small business.”
Wispa and Ispanz support the commission’s study, but say the volume and level of data requested is “overkill” and “unwarranted”, especially on what they feel is relatively short notice.
The commission’s data-gathering is designed to uplift its broadband monitoring and reporting. It will be an annual exercise.
Both associations the commission to compensate their members for the cost of collecting the information, or contribute towards the expense, but that has so far not happened.
However, smaller providers often do not have the staff required to collate the information demanded, if indeed it has been collected in the first place. Bigger telcos are captured by the Rural Connectivity Study, and yes, SpaceX’s Starlink has also been issued with a Section 98 notice by the commission.
We’ll see how the connectivity study goes in the end, but further discussion around practicalities of collecting the information seems warranted. Maybe a third-party could be engaged to collect the data?
There is an element of controversy associated with the study. The commission wants the study to be high resolution, and will request enduser location information.
“The geographic location of endusers is essential because we want to compare availability of services and availability of technologies. Aggregation into meshblocks [the 57,539 statistical areas New Zealand is divided into], for example, reduces resolution and when you then compare two datasets, where that type of aggregation has been applied, you lose accuracy and are in danger of inaccurate conclusions,” the commission said.
While the commission said the actual connection at an address would not be visible in maps and analysis, in some cases it might be possible to request the study data under the Official Information Act.
The commission has put in place sensible safeguards with high thresholds, but says it cannot commit to never releasing the data, because the act is law.
Rural broadband was always going to be the tricky part of the fibreto-the-premises equation.
A telco industry source, who wished to remain anonymous, suggested the reason the Ultra-Fast Broadband fibre project happened was because the Government at the time split the rollout into two.
If the project had attempted to provide coverage in as many places as possible in one go, the cost would’ve been a politically unpalatable $10 billion or more.
With the UFB completed, there’s political will and acceptance now that rural areas can’t be left behind when it comes to necessary network connectivity, and the money needed looks less daunting.
The Rural Connectivity Study should be a useful tool for that, but it looks set to be a point of pain for smaller providers.