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Gigatown

Chorus says it will offer gigabit fibre services starting next month making every town a Gigatown. It joins Enable Networks, Northpower Fibre and Ultrafast Fibre who all plan to launch gigabit wholesale broadband services in October.

From next month they will all offer download speeds of 1Gbps with uploads running at 500Mbps.

If customers take up the offer[1], the gigabit upgrade could catapult New Zealand up the global broadband speed ranking.

Chorus says it will sell residential wholesale gigabit services for $60 a month. That’s an introductory offer to get everyone hooked. From June 2017 the price will rise to $65. The business service is $75.

ISPs quick to react

Within minutes of Chorus’ announcement, MyRepublic said it would offer gigabit services in all UFB areas. Customers signing for a 24-month plan get the first six months at the wholesale rate and pay $120 a month for the rest of the term.

Spark is already taking orders for gigabit fibre plans. Orcon plans to launch gigabit services as soon as they are available.

One of the smaller ISPs, Tauranga-based Full Flavour has been quick off the block. It now sells gigabit services and says more than 3000 local businesses in Tauranga are able to take up the offer.

Another regional ISP, Taranaki’s Primo Wireless, also offers gigabit plans.

Top gear

In a media statement Chorus says its gigabit service: “Will run at the maximum speed the network electronics allows today. In practice this means customers will see download speeds of between 900Mbps and 970Mbps and upload speeds of up to 500Mbps.”

No-one is going to quibble about the difference between 900Mbps and 1Gbps because no-one will notice.

In some ways the numbers are meaningless. Once you get past 100Mbps[2], broadband speeds are more about marketing than technical practicalities.

A normal New Zealand home will struggle to use 100Mbps. Even so, Dunedin residents were keen to sign up for Gigatown accounts.

Streams of high resolution television

Gaming aside, the most demanding domestic application is 4K television and that can stream well enough inside the lowest priced 30Mbps fibre services. You’d need half a dozen 4K televisions to put pressure on a 100Mbps link.

Even hospitals and medical practices running high-end imaging equipment will struggle to make use of the high speeds. Gigabit internet might be useful if you plan to build a large hadron collider in your garage.

Yet things change. High-resolution virtual reality entertainment looms on the horizon. If it takes off, it could see households bump up against today’s speed limits. Who knows what else might be on the way?

Back in the here and now, 1Gbps means users are buying a lot of headroom. That can be helpful. A car with a top speed of more than 200kph might be overkill for driving around town. Yet when the chips are down on a rural overtaking lane, extra grunt at the top can get you out of trouble.


    1. Chorus says there are 5000 Gigatown subscribers in Dunedin. That shows there is clear demand for faster internet services.  ↩
  1. That’s now most fibre users. You have to wonder why anyone buys 30Mbps fibre plans. Communications minister Amy Adams says between March and June 2016, 87 percent of new residential connections were for 100Mbps services or higher. Nine percent of new connections are 200Mbps or above.  ↩

GigatownEnable Networks, Northpower Fibre and Ultrafast Fibre plan to launch gigabit wholesale broadband services in October. They say they will offer download speeds of 1Gbps with uploads running at 500Mbps.

Meanwhile Spark New Zealand says it is already testing Enable’s gigabit services in Christchurch. The company had previously asked wholesale fibre companies to roll out gigabit services nationwide.

MyRepublic managing director Vaughan Baker says his company will automatically upgrade its 200Mbps customers in Whangarei, Hamilton, Christchurch to a 1Gbps plan for no extra cost when the service becomes available in October.

The three fibre companies planning a gigabit upgrade have local wholesale monopolies in about one-third of UFB areas. Northpower operates in Whangarei, Enable run the network in and around Christchurch while UFF is the fibre wholesaler for much of the central North Island.

It started in Gigatown

Chorus, which operates fibre networks throughout the rest of New Zealand says it is discussing the matter with its partners. It already offers a gigabit service in Dunedin which won Chorus’ Gigatown competition.

Dunedin has had a mixed gigabit broadband experience. While there’s evidence that some companies are making use of the high speeds, there has also been criticism about getting connected to the service. There is also a debate in the city over whether it has attracted businesses.

Even so, there’s ample evidence consumers want faster broadband speeds. That’s despite there being few residential applications to challenge the 200Mbps services already on offer.

Enable says most of its residential customers are now ordering services with download speeds of 100Mbps or 200Mbps. It says existing fibre users are upgrading to faster speeds.

The company says it plans to work with its retail service providers to launch new services to homes in Christchurch, Rangiora, Kaiapoi, Woodend, Rolleston and Lincoln.

New Zealand hooked on speed

After a slow start, Ultrafast Broadband is gathering momentum and the greatest demand is for the fastest services.

Communications minister Amy Adams says between March and June 2016, 87 percent of new residential connections were for 100Mbps services or higher. And 9 percent of new connections are 200Mbps or above.

She says: “There are already over 3700 active residential 1Gbps services in New Zealand, and I expect to see this grow. LFCs have announced wholesale products. I encourage the industry to collaborate to offer gigabit plans at a retail level on attractive terms.”

Christchurch skyline

Phones connected to Spark’s Central Christchurch mobile site can now download data at 1Gbps. Or, to be more accurate, they will when the hardware arrives in New Zealand later this year.

Spark has worked with Huawei to upgrade its Central Christchurch cell-site to 4.5G. The company’s Hereford Street building houses the Pacific region’s first commercial 4.5G site. It is one of the world’s first non-test 4.5G sites.

At the network launch today, Spark New Zealand managing director Simon Moutter says: “We built the network well ahead of the devices. One of the key things is to learn from this. We’ll build other sites later in the year.”

Gigabit wireless in New Zealand

Spark’s general manager, networks Colin Brown demonstrated the network’s ability to deliver gigabit speeds. He used special equipment for the demonstration. In the live test, download speeds reached 1.12Gbps. Brown said overnight the test gear recorded a peak of 1.25Gbps.

While 1Gbps is the 4.5G headline speed that’s not what most user will see when they connect. Brown says people will see speeds that are; “three of four times what you see today”.

The key to 4.5G speeds is the technology’s ability to use spectrum in different bands at the same time. The telecom industry calls this carrier aggregation. It also uses multiple antennae simultaneously to boost capacity.

With 4.5G data speeds and capacity increase at the same time.

Huawei New Zealand CEO Jason We says beside boosting data speeds, a 4.5G cell site can service ten times as many users as a 4G site.

Using 2300 MHz spectrum

One of the four spectrum bands used to deliver Spark’s 4.5G service is the 2300MHz block once owned by Woosh Wireless. The Commerce Commission cleared Spark to buy the spectrum at the end of March.

Moutter say it took just a matter of weeks to pull the 4.5G demonstration together. He says; “It demonstrates what we had our eyes on and why we were keen to acquire the Woosh spectrum.”

Because 4.5G is, in effect, a software upgrade to the 4G network, Spark could move fast.

Recipe for a 4.5G network

Brown says for a 4.5G roll-out Spark needs four things: “Above all else you need the software. We have this from Huawei and will be rolling out elsewhere between now and Christmas.

“The second thing you need is the antennae. You have to install them at the sites. To make 4.5G work you also need improved backhaul to take data traffic from the cell site to the internet. Generally speaking you need gigabit backhaul. You also need to devices”.

Huawei’s Wu says his company will be bringing 4.5G ready devices to New Zealand later this year.

Joint innovation

Spark’s 4.5G project is the latest fruit from the company’s joint innovation programme with Huawei. Previously the two built the world’s first commercial 4G network using 700 MHz spectrum

At the Christchurch launch David Wei, President Huawei South Pacific, says that earlier partnership pushed the boundaries of technology.

He says: “Today we continue that tradition with New Zealand’s first 4.5G giga site. For us one of the best parts of this partnership is that we are able to deliver technologies which until very recently only existed in our research and development labs.”

Spark and Huawei agree that video will be the big application on the 4.5G network. Wei says: “4.5G can support rich content streaming and true 4K video. It will be used to create a strong network supporting the emerging internet-of-things”.

Video made the radio star

Moutter says for practical 4K streaming video, a network must deliver a consistent 15Mpbs.

Brown says one aspect of 4.5G is the 2300 MHz spectrum can be configured with TDD (time-division duplexing). He says this means the spectrum can be optimised for downloading. This is an arrangement that works well with video traffic.

TDD is also used by a lot of fixed wireless broadband services. The potential for a 4.5G network to deliver fibre-like speeds to fixed wireless broadband customers could change the nature of services in rural New Zealand and present Chorus and the other fibre network companies with a serious challenge.

4.5G means bigger data caps

A network capable of 1Gbps downloads could mean customers will chew through monthly mobile data caps in seconds.

Moutter says: “The additional capacity of the 4.5G network is significant. It allows use to expand usage bundles at economic prices”. In other words: expect to see more generous monthly data allowances from Spark as the new network rolls out nationwide.

He offered insight into the pricing of mobile data saying Skinny’s Wireless Broadband which gives users 60GB of data for $55 would have been impossible just two years ago. The same applies to Spark’s wireless broadband product.

Moutter says: “Spectrum has been the constraining asset. We’ve invested in buying more spectrum. Using aggregation is the key to getting more from our investment”.

Christchurch technology

Moutter says Spark chose to use Christchurch as a demonstration site because it “wanted to do something special for the region.

He says Canterbury area is one of the first to be updated with 700 MHz spectrum services. He says: “We’re close to half-way done with that.

“After the earthquake we had to move the network around in Christchurch. Much of it, indeed much of the city, moved out to the edge. Now we want to focus on bringing technology back to the centre of the city. This was a good opportunity to commit to the rebuild”.

You can see the Spark 4.5 antennae on the top of the Hereford Street building in the photo at the top of the page. 

gigabit mobile

Gigabit mobile speed is a key promise from the equipment makers preparing 5G network hardware. It will take until at least 2020 before anyone builds a 5G network in New Zealand, yet there’s a good chance we’ll see gigabit speeds before then.

Last month Comms Day reported on an Optus-Huawei 4.5G trial which hit a peak speed of 1.23Gbps over the air in live network conditions. The newsletter reports the test has a theoretical maximum speed of 1.43Gbps.

Earlier Telstra worked with Ericsson to get speeds of 1Gbps on its commercial network.

The key to fast speeds lies in aggregating spectrum from different bands. Telstra pulled more than 100 MHz of spectrum from five different bands.

New Zealand’s two biggest carriers, Spark and Vodafone, have the spectrum to do the same here.

Of course the Australian trials are just that, trials. They use non-commercial handsets and purpose-built test sites. While you’d be lucky to get similar speeds in practice, the theoretical high speeds are useful pointers showing where mobile technology is going.

Optus told Comms Day the 4.5G network could be operational later in 2016, but that handsets to exploit the high speeds will not appear until the end of this year or early in 2017.

At this year’s Mobile World Congress, Huawei president of products and solutions Ryan Ding said his company is already working with 60 international telcos on 4.5G networks. I asked about New Zealand and got a diplomatic non-committal answer, but in earlier discussions with Huawei was told we are likely to be among the first countries to get gigabit mobile.

Gigatown

Sheldon-Grizzle
The Company Lab founder Sheldon Grizzle in Auckland to promote Gigatown.

Chorus plans to make one New Zealand town the best-connected place in the Southern Hemisphere.

The telecommunications infrastructure company is running Gigatown: a year-long competition pitching communities against each other to show their worthiness as New Zealand’s fibre showcase.

When the competition closes, Chorus will offer winning town residents 1 Gbps fibre connections on the UFB network at the same price they would normally pay for the cheapest 30 Mbps plan.

To win, a town has to prove it has what it takes to best exploit faster fibre internet speeds.  That means coming up with creative ideas and rethinking how to weave digital communications into everyday life.

The competition is only open to towns, or parts of cities, in Chorus’ UFB coverage area – about 70 percent of the total.

Gigatown: smart marketing or social stimulus?

Chorus says it is running the competition: “to encourage New Zealanders to start thinking about UFB as a huge opportunity to transform our country’s economy and deliver great social outcomes”.

It’s not the whole story.

UFB has not been a happy experience for Chorus. When the company was still part of Telecom NZ, it won the bulk of contracts to build the government’s fast fibre network — a National Party election promise in 2008. Chorus demerged from Telecom NZ as part of the deal with the government — a painful, expensive process for both companies.

Creating a fibre buzz

Once the UFB project began, it was clear the government had negotiated fierce terms. Chorus found higher than expected cost. Meanwhile, the rate of customer sign-up to the new network was lower than early forecasts.

As the implications of this dawned, the government controversially intervened with Commerce Commission regulation of copper internet services.

Despite this, UFB project economics mean Chorus needs to encourage more businesses and consumers on to the network.

Chorus is not a retail service provider. It’s a wholesaler, so marketing UFB services isn’t the company’s job. Indeed, if it goes down that route it could step on its customers’ toes.

Hence Gigatown. A smart piece of marketing to give the UFB network a higher profile with potential customers and stimulate interest, even demand for fibre, but without cutting across the direct sales pitches from retail service providers. Creating a Gigatown buzz will certainly help raise awareness of fibre with early adopters and key business groups.

Like Chattanooga, only different

Chattanooga, Tennessee is the poster child for what fast broadband can do to regenerate a community. The city is roughly the same size as Wellington – although the physical geography is quite different. Historically it was an industrial city. In 1989 it was named as America’s dirtiest town.

Chattanooga, Tennessee
Chattanooga, Tennessee

Chorus invited Sheldon Grizzle, heads a non-profit economic development agency in Chattanooga to explain how fibre turned the city around. He says the city was in decline. At one point the population fell by 10 percent as people drifted away to nearby cities where they had more prospect of work. The word Grizzle uses is not drifting, but ‘fleeing’.

Like many post-industrial US cities, Chattanooga suffered when the factories closed. Then a decade ago an online TV channel set up business in town. It brought-in people with digital knowledge and design skills. The TV project fell through, leaving behind a core of around 300 people determined to carve out a future in the city.

Reversing the decline

Grizzle says the influx of broadband TV people kickstarted a freelance economy in Chattanooga. They were mainly developers and designers who realised they could contribute to the global economy from any place that had the right communications networks.

At first, the city’s broadband was only average, but Grizzle says there was a fibre network which was originally installed to help manage the city’s energy grid. When this was used to deliver gigabit-fibre, things turned around fast. He says the most important thing was that gigabit fibre just made everything so much more efficient.

Since the network went into operation three years ago, the population drift has reversed. Grizzle says Chattanooga is the first city to see a 10 percent decline in population followed by a 10 increase as people returned. Today there are start-up incubators in renovated factories and one of America’s largest web design schools has set up there.

Fibre by-products

One interesting by-product of having what Grizzle calls “ubiquitous” fibre throughout the city is that it meant the city authorities could cheaply and quickly build a wireless mesh network for city services. Grizzle says this wireless network sits on top of the fibre network and is used by emergency and public safety services.

Grizzle says a net 6700 new jobs have been created since the fibre network began and there’s a noticeable influx of talent. There’s also fresh money. He says the amount of venture and angel capital in the city has grown by a factor of five – a clear sign of returning prosperity and confidence.

It didn’t take long for the word to spread. Now Chattanooga is a testing-ground for high-speed broadband applications in a range of vertical markets. And other cities, including Detroit, now one of the most run-down in America, have turned to Chattanooga to tap into the lessons from installing fibre.

Lessons for New Zealand

Grizzle says it’s taken a long time for people to get their heads around the potential, benefits and opportunity of fibre. Three years after the network began, he says it is still only early days. To date the residential take-up of fibre services remains relatively low, this hasn’t made much difference to the city’s economic growth.

While only one town – or part of a larger town – will get Chorus’ gigabit service at an entry-level price, the faster internet service will be available throughout urban New Zealand. The prices  Chorus charges New Zealand businesses for UFB are in line with those in Chattanooga.

In other words, if we get this right, our fibre-lead regeneration could be on a national scale rather than just in one centre.

In the immediate future, most gains will come from the efficiency of faster broadband, but we could expect something of a design renaissance.

One aspect of special interest will be what happens to New Zealand’s economy relative to Australia’s. It now looks like we will build a fast fibre-to-the-premises network while Australia could stick with fibre to the node. Can fast broadband reverse our relative economic decline, or at least improve it compared with our rich neighbour?

While you can find plenty of opinions on this, no-one knows for sure. No doubt governments and planners around the world will be watching closely to see how that works out.