Summary of Broadband Internet Access Service Performance
20. New Zealand has good broadband access availability (currently ~92% of dwellings, projected to be available to ~95% by the end of 2004) which compares favourably with other OECD countries.
21. Significant broadband infrastructure competition is developing in particular areas.
22. Broadband Internet access service uptake in New Zealand, 2.9 lines per 100 population as at March 2004, is amongst the lowest in OECD countries where broadband is being actively promoted. The following graph shows broadband uptake performance in OECD countries as at December 2003.4
Broadband Connections in OECD Countries plus Taiwan - per 100 Population, December 2003
→ Full size version of "Broadband Connections in OECD Countries plus Taiwan - per 100 Population, December 2003" [11 KB GIF file]
23. For typical residential user broadband data usage, the price of residential broadband service now compares well with the OECD average.5 The price would have to reduce by ~23% to be placed within the first quartile of OECD performance. However, the price of Telecom New Zealand broadband service plans with higher included data capacity, is significantly above the OECD average.
24. The price of business quality broadband service is significantly above those in the other OECD countries. For low data usage (~3GB per month) Telecom New Zealand's price was ~80% above the 17 OECD country average. For medium data usage (~5GB per month) it was ~160% above the 17 country OECD average. The main factor underlying high pricing appears to be the high per megabyte data transmission charge, which is typically two to four times the residential users excess data charge.
Key Points
25. New Zealand's broadband service uptake performance compared to most other OECD countries is unsatisfactory. Following the introduction of new and improved residential user broadband access plans in March 2004 there are encouraging signs that broadband uptake is improving. However, other OECD countries are also improving their broadband uptake.
26. Business broadband access pricing performance relative to other OECD countries is unsatisfactory. It is likely that entrants will use the unbundled bitstream service when it becomes available to provide an alternative business broadband service. However, the UBS is likely to be best suited to providing lower broadband speed Internet access services.
27. As broadband access uptake improves and the capability to support advanced telecommunication services such as voice over IP, video conferencing etc develops, it will be important to reliably benchmark New Zealand's performance relative to other OECD countries in delivering such new services.
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