While well aware of the many different ways of ensuring its customers connect to the internet of things, Telecom’s role is to be connection agnostic says Simon Moutter.
From the consumer point of view, they don’t often care or know whether it is through copper, fibre, Wi-Fi or cellular says the year-in-the-role chief executive.
“Everything’s about data connectivity and we have to do that as seamlessly as possible in a secure, safe and Telecom authenticated fashion,” he says.
Moutter watched with interest as Telecom’s previous network services business became Chorus; now charged with installing ultrafast broadband across much of the country; but excluding Northland, Hamilton and Christchurch.
Chorus’ estimated installation price was $300-$400 per household. The actual cost appears to be much higher at $1000-$1400 a house. Chorus’ challenge is not one that Moutter has to answer however. “In the end, under their contract, they’re obliged to make connections and meet certain service standards,” he says. “We rely on the same customers that they rely on.”
In the meantime, Telecom is upping the internet connectivity of its old copper line network through VDSL (very high bit rate digital subscriber line). Its marketing combines the even faster fibre and VDSL as a single idea.
“Profit free zone”
The competitive price of about $75 a month per household for broadband connection through any of the major telecommunications' providers has seen Moutter describe it as a “profit free zone”. After paying Chorus its $45 a month fee, it is not difficult to see how there's little margin for the likes of Telecom.
But, as part of providing its customers with seamless network connection, it is all part of a telecom's reality; and also part of the reason for a greater focus on Telecom's mobile data network.
This particularly means 4G.
The price of 700 Mhz
Moutter’s keen to see the government not demand that telecom companies are forced to pay too much for the 700 MHz spectrum, which has a greater capacity and reach than the 1800 MHz used at present.
This also provide the ability to carry Wi-Fi signals in urban areas. Telecom is repurposing some of its payphones to do just this.
An increasingly important part of Telecom’s offer will be the content it is able to offer customers across its integrated network.
“Under this network of things, with its new capacity, we’re seeing some of the same disruption that's already occurred in music companies, the CD industry, newspapers and the media,” he says.
Video content in particular will be delivered over Telecom’s network, including the recently announced English football games.
“In the past, say in 2008, that wasn't really feasible, it was way too expensive”, he says.
“Today the economics are much closer and that provides some real issues. The models of content delivery will profoundly change, and that's the new way of the world.”