UFB adoption jumps as fibre build reaches 60 percent stage

New Zealand's Ultra-Fast Broadband project reached a significant milestone in February 2016, with customer adoption surging and the network build hitting 60 percent completion. After years of regulatory battles over copper pricing that threatened the rollout's viability, the programme is not only on track but exceeding uptake expectations.

Communications Minister Amy Adams announced that UFB connections had jumped 135 percent in the previous year and 22 percent since September 2015 alone. Almost one-in-five customers able to connect to the fibre network were choosing to do so—up from about one-in-nine a year earlier.

The numbers represented a significant vote of confidence in the government's UFB investment and suggested that concerns about low uptake rates, which had featured prominently in earlier debates about the project's financial sustainability, had proved unfounded.

Uptake strong by international standards

New Zealand's fibre adoption rate is impressive by international standards. Many countries with similar fibre-to-the-premises networks struggle to convince customers to migrate from existing copper or cable services, particularly when those services offered adequate speeds at lower prices.

The 20 percent uptake rate among premises passed shows New Zealanders are willing to pay for better connectivity. This was particularly notable given that copper broadband services, boosted by VDSL technology, remained competitive for many everyday uses.

The strong adoption also validated the pricing structure that emerged from the contentious UBA and UCLL regulatory battles of 2013-2015. While critics had argued that keeping copper prices relatively high amounted to a "copper tax," the differential between copper and fibre pricing was helping drive migration to the newer technology.

Build progress and coverage

The 60 percent completion figure meant that fibre is now within reach of the majority of targeted premises. According to Adams, the network covers 96 percent of businesses and 100 percent of schools—though the business figure likely excluded home-based operations.

Regional progress varies considerably. The breakdown suggests that suburban Auckland, with its sprawling geography and mix of housing densities, will be among the last areas completed. This is unsurprising given the capital-intensive nature of laying fibre through established suburban streets.

The phased rollout means different parts of New Zealand experience the fibre revolution at different times, creating a patchwork of connectivity that will only resolve as the build approached completion in 2019.

Rural broadband transformation

Beyond the urban UFB footprint, the Rural Broadband Initiative is delivering significant improvements. Adams says Vodafone has installed 13 new wireless towers and upgraded 12 existing towers in the previous quarter alone. Over the full year, 135 new towers have been built and 336 existing towers upgraded.

Simultaneously, Chorus has upgraded more than 1,180 rural cabinets under the RBI programme.

However, the real story in rural broadband isn't the numbers—it is the technology shift from 3G to 4G mobile. Vodafone's RBI service initially struggled with 3G technology, leaving many rural customers frustrated with unreliable, slow connections. The switch to 4G transformed the service from barely adequate to genuinely competitive.

The arrival of competing rural wireless services from Spark intensified pressure on Vodafone to improve quality and coverage. The result is a race to upgrade remaining towers to 4G and regain customer confidence in rural areas where fibre may never be economically viable.

For rural New Zealanders, access to 4G wireless broadband represents a genuine leap forward. Performance testing of fixed wireless connections, such as the Skinny network in urban settings, shows that 4G can deliver fibre-like speeds. For farms, rural businesses and remote households, this level of connectivity is transformative—enabling everything from precision agriculture to remote working that simply wasn't possible with earlier technologies.

The broader context

The February 2016 announcement came at a crucial moment for the UFB project. Network operators, particularly Chorus, have weathered significant financial and political challenges. The regulatory uncertainty of 2013-2015 raised serious questions about whether the UFB build could be completed on the originally negotiated terms.

The strong uptake figures and steady build progress suggested the project is working despite those challenges. Customer demand is real, the technology is delivering as promised and New Zealand is on track to achieve access to gigabit-capable broadband in urban areas—a remarkable achievement for a small, geographically dispersed nation.

The success also set the stage for the next phase of the telecommunications transformation: planning for the eventual retirement of the copper network that UFB was designed to replace. With fibre uptake accelerating and wireless alternatives improving rapidly, the long-term future of copper is becoming increasingly clear.