Rants, Raves, Reviews

CallPlus want rate payers money

By Gary R, in , posted: 6-Aug-2007 14:47

Malcolm Dick has come out of the woodwork to not only bid for the Auckland City municipal WiFi network but to also attack and despair about the apparent

'poor infrastructure we have here and the lack of initiative on the development of something that will ultimately be accepted as having been as important as the development of roads, telephony and electricity.'

Dick goes onto add that

I know that we actually have a trickle of customers who cancel their service citing “Broadband in NZ sucks – going to live overseas”.

What? People actually leave NZ because 'Broadband in NZ sucks'? The people I know that have left have gone for other reasons like weather, better pay, better lifestyle, more opportunities, etc. I know of no one who has left because YouTube is always buffering.

Dick is offering to build a 'world class' 1,000 site WiFi network for a meager $2.5m of rate payers money. He is even kindly offering to use some of his 3.5Ghz WiMAX spectrum for the back-haul. CallPlus will act as the wholesaler and offer the network to other service providers on commercial terms.

Of course Dick is doing all this because he doesn't want his 'kids to bugger off overseas permanently' and not because of a potentially lucrative 5 year contract to exclusively run and manage a council endorsed, backed and promoted extensive WiFi network that covers our country's largest city.

Dick labels himself as a 'successful businessman' and of course he is, this is obviously why CallPlus are taking on all the commercial risk. All risk and no return? I doubt it when you consider the possibilities:

1. No risk infrastructure investment - paid for by the public
2. Exclusive 5 year contract
3. Sell access to other providers - CallPlus could sell to Slingshot who could in turn use the network to provide broadband to the apartment dwellers
4. Uninhibited access to mount the AP's on council buildings and street lights - no issues waiting for resource consents and no costly location leases
5. Free promotion - the council would provide promotional support to encourage usage
6. Free use for Auckland City Portal - this is a goody, configure the AP to serve up a portal that contains the council endorsed 'free' websites. CallPlus can then sell portal advertising

Not that long ago CallPlus announced that they had acquired $450M in investment of which some would be used to build out a WiMAX network. Recently the media were speculating that the funds had fallen through. I am now wondering if this latest announcement is an attempt to piggyback on the public purse.

Other related posts:
The Butler and Butler 5 Point Plan
National to invest in broadband
We Blew our cap again

Comment by sbiddle, on 6-Aug-2007 15:21

Muni WiFi networks are a dead loss. The whole business case is flawed (or non existant) and the reality is that the only people making money are the equipment suppliers who are getting $$ from somebody!

Even Google can't get San Francisco on board.

Comment by Matt, on 21-Nov-2007 18:40

I was thinking of moving oversea's (a few years back) because broadband in NZ sucks. LOL, crazy ahh!!!, Thankfully things are starting to get better.

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