Telecom Wholesale deploying VDSL2

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Regs

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Snowflake

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# 198875 3-Mar-2009 02:36

Screeb:

There's very little incentive for Telstra to build a second trans-Tasman cable, due to their new cable which you mentioned - most of Telstra's traffic will now go through that cable, instead of going via NZ. They have no interest in going through NZ (aside from redundancy), so it would be pointless to build a trans-Tasman cable now. Don't forget that TelstraClear has very little pull with Telstra, so a cable is not going to be built just for them either.

So being able to offer this country alternative bandwidth to the SCC via a wholly owned telstra link from NZ-AUS-US wasn't enough incentive? If so then I wonder how PIPE/Kordia can justify the new investment...

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maaark

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# 198908 3-Mar-2009 10:31

Re:VDSL - I think this is a very relevant issue to rolling out VDSL to households

from computerworld by Ralph Chivers:

"It’s a little known fact that the standard of your household wiring is one of the key determinants of the speed and quality of your broadband service. In fact, even dial-up can be significantly hampered by that ugly bird’s nest of self-installed extension wiring tucked out of site under the floorboards."

Will VDSL need a home wiring certificate to avoid disappointment of sub optimal speeds?

cyril7

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# 198929 3-Mar-2009 11:33

Telecom (via Telepermit) have updated the specification of DSL filters for the benifit of VDLS2 connections, the new filters are a 3port device with a HP section in the DSL modems port this is reported to assist matching of the modem to the line (rather than filtering) and helps optimise performance. That said the current MM3200B is quite adequate but is to soon be replaced with a 3port one that as yet has not been released by Marque Magnetics. I have just updated my phone distributor to allow integration with either 2port or 3port filters.

With VDSL2 you most certainly will need a central filter installed (either 2 or 3port) and with as few joints as possible to get optimum out of it as it extends through to 8-12MHz rather than the current 2.2MHz of ADSL2+

Cyril

Screeb

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# 198969 3-Mar-2009 14:47

Regs:
So being able to offer this country alternative bandwidth to the SCC via a wholly owned telstra link from NZ-AUS-US wasn't enough incentive? If so then I wonder how PIPE/Kordia can justify the new investment...

Obviously not, since they haven't done it... This is Telstra, which are an Australian company. Just because the opportunity exists doesn't mean they are going to persue it. Do you think every company should go after every opportunity that exists everywhere in the world? Telstra obviously have better and more relevant things to do than give NZ another cable. Kordia justify it by being a NZ company (more relevant than an Australian one, since the cable would benefit NZ far more than AU), and because they're a SOE.

PenultimateHop

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# 198997 3-Mar-2009 16:33

Screeb: There's very little incentive for Telstra to build a second trans-Tasman cable, due to their new cable which you mentioned - most of Telstra's traffic will now go through that cable, instead of going via NZ. They have no interest in going through NZ (aside from redundancy), so it would be pointless to build a trans-Tasman cable now. Don't forget that TelstraClear has very little pull with Telstra, so a cable is not going to be built just for them either.

Why would Telstra's traffic via Southern Cross go via New Zealand? If anything, Telstra's new cable increases the incentive to build a spur to New Zealand for two reasons:

1) If the spur had been constructed at the same time as Endeavour, the additional build cost would have been minimal.
2) Telstra now have access to all major exit routes from Australia (SCC, SEA-ME-WE-3, AJC, Endeavour, etc), so they are in a position to sell competitively priced IRUs. This would be particularly good for connectivity into Asia and Europe - an area where SCC can't compete - rather than North America.

Screeb: Not sure what you're trying to say here... SCC is figure 8, unlike many cables in the region.

The cable (and company) is still a Single Point Of Failure. A figure 8 is only useful if you have bought protected capacity, which many people don't. Watch what happens in a single ring failure.

Screeb: Telecom was a monopoly, thus they had all the money, resources, and potential for gain necessary to build the SCC. It's harder for others to build a second cable simply because they wont have a monopoly like SCC did.

Telecom is one of three investors in Southern Cross (there were four initially, I think, Telecom bought the fourth out, which is why they have the 50% stake). If there is such a cash cow - and I think it would be a struggle to make NZ-Australia work without significant onwards network - then I don't see why people haven't done it already. I am not convinced Kordia is appropriate to do it for several reasons, and right now I don't have faith that Pipe and Kordia can successfully pull off PPC-1 and PPC-2.

Still, I find your arguments difficult to understand. On the one hand, you say that it's clearly a monopoly/cash cow position and that there should be other entrants to the market -- but not some of the entrants, because it's not profitible enough?

Screeb

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# 199094 4-Mar-2009 03:15

PenultimateHop:
Why would Telstra's traffic via Southern Cross go via New Zealand?

Sorry, got a little mixed up there. It's possible that they have been using the NZ SCC route as redundancy (normally using the AU route), and now that they have their own, they would no longer need it. But I don't know, I'm just hypothesising.

If anything, Telstra's new cable increases the incentive to build a spur to New Zealand for two reasons:

1) If the spur had been constructed at the same time as Endeavour, the additional build cost would have been minimal.
2) Telstra now have access to all major exit routes from Australia (SCC, SEA-ME-WE-3, AJC, Endeavour, etc), so they are in a position to sell competitively priced IRUs. This would be particularly good for connectivity into Asia and Europe - an area where SCC can't compete - rather than North America.

Perhaps, but they're not doing it. So they clearly have their reasons.

The cable (and company) is still a Single Point Of Failure. A figure 8 is only useful if you have bought protected capacity, which many people don't. Watch what happens in a single ring failure.

I'd be very surprised if Telstra didn't have protected capacity...

Telecom is one of three investors in Southern Cross (there were four initially, I think, Telecom bought the fourth out, which is why they have the 50% stake). If there is such a cash cow

I don't think anyone's saying there's a cash cow to be had. It's a reasonably big investment, and it has a long time until ROI. The cash cow is SCC.

>and I think it would be a struggle to make NZ-Australia work without significant onwards network

Of course, which is why PPC-2 is relying on PPC-1.

>then I don't see why people haven't done it already

For that exact reason. The only decent route out of AU was SCC for a long time, hence it would make no sense to build a NZ-AU cable since you've already got access to the NZ SCC cable. Only now that PPC-1 is being built is there a good business case for a new trans-Tasman cable.

I am not convinced Kordia is appropriate to do it for several reasons, and right now I don't have faith that Pipe and Kordia can successfully pull off PPC-1 and PPC-2.

Why not?

Still, I find your arguments difficult to understand. On the one hand, you say that it's clearly a monopoly/cash cow position and that there should be other entrants to the market -- but not some of the entrants, because it's not profitible enough?

>you say that it's clearly a monopoly/cash cow position

Correct.

>and that there should be other entrants to the market

"Should be" as in "beneficial to NZ"

>but not some of the entrants, because it's not profitible enough?

Not every business is in the business of laying undersea cables wherever they feel like it. What I'm saying is that it's not as profitable as SCC is/was. I.e., the original business case for SCC was much better than any subsequent business case would be for a second cable by a different company. Like I said, the only reason PPC-2 is being considered is because of PPC-1.

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