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Reply # 686146 14-Sep-2012 20:27

DonGould: As for transit to .au being $6, again and again and again everyone on all the public facing lists talks about that not being the problem, we know that. The problem is again and again and again is said to be the national transit.

If I'm wrong, cool. How do we fix it because clearly we're not managing at present.

Australia has better value than we do.

So... if we all agree the actual issue is the cost of national transit why do you keep on going on about wanting to land another international cable.

- SCCN has the same costs to land data in NZ as it does in AU from the US.
- 5% of SCCN usage goes to NZ the vast majority goes to AU. One could also assume the larger AU telco's get better deals since they are using the cable more. SCCN is a business afterall and would give larger discounts to larger customers.
- SCCN has been going now for 12 years so one could assume it's already covered its initial setup costs or well on it's way.
- SCCN are contining to do upgrades to exponentially increase capacity.
- SCCN have been reducing prices on the cable year on year since.
- There is already compeition for cables into AU.

So one could "assume" that the price of wholesale internet by SCCN to NZ is "fair".

If anyone was going to build a new cable, it IMHO should be based off building a new cable to AU and through the grace of god come via NZ like SCCN did (thanks I would say probably due to Telecom being 50% owner)

Have a look at: http://www.submarinecablemap.com/
And see how it really works in the world.

Building another cable such as PF or Kordia's Optikor, or this Kawaiki endeavour is a process in throwing away money. Strangely enough Venture Capitialises don't like throwing away money hence why none of these will get off the ground. The idea that you would land the cable anywhere other than Auckland is just insanity.

mercutio

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Reply # 686148 14-Sep-2012 20:30

DonGould:? 1Tb data plans.? Show me a 1Tb data plan with TelstraClear on their HFC network.

Australia isn't any better for hosting than NZ. It still makes sense to host in the US.

There's no high quality video in NZ. Look at nzherald, it's way behind bbc and cnn for video quality.

mercutio

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Reply # 686149 14-Sep-2012 20:31

BarTender:
DonGould: As for transit to .au being $6, again and again and again everyone on all the public facing lists talks about that not being the problem, we know that.? The problem is again and again and again is said to be the national transit.

If I'm wrong, cool.? How do we fix it because clearly we're not managing at present.

Australia has better value than we do.

So... if we all agree the actual issue is the cost of national transit why do you keep on going on about wanting to land another international cable.

- SCCN has the same costs to land data in NZ as it does in AU from the US.
- 5% of SCCN usage goes to NZ the vast majority goes to AU.? One could also assume the larger AU telco's get better deals since they are using the cable more.? SCCN is a business afterall and would give larger discounts to larger customers.
- SCCN has been going now for 12 years so one could assume it's already covered its initial setup costs or well on it's way.
- SCCN are contining to do upgrades to exponentially increase capacity.
- SCCN have been reducing prices on the cable year on year since.
- There is already compeition for cables into AU.

So one could "assume" that the price of wholesale internet by SCCN to NZ is "fair".

If anyone was going to build a new cable, it IMHO should be based off building a new cable to AU and through the grace of god come via NZ like SCCN did (thanks I would say probably due to Telecom being 50% owner)

Have a look at: http://www.submarinecablemap.com/
And see how it really works in the world.

Building another cable such as PF or Kordia's Optikor, or this Kawaiki endeavour is a process in throwing away money.? Strangely enough Venture Capitialises don't like throwing away money hence why none of these will get off the ground.? The idea that you would land the cable anywhere other than Auckland is just insanity.

Australia has a lot more money than NZ. New Zealander's are cheap. What I hear from NZ internet users is how can I get internet similar to what I have now but cheaper.

What NZ needs is NZ content. Even if people starting hosting off their UFB connections.

If there was a tax on international bandwidth in NZ then maybe more stuff would be brought closer to NZ. The US already wants to tax international bandwidth coming into NZ. Why not do the same, and use it for the government to invest in their own cable?

While we tax incoming bandwidth, outgoing can be tax free. And NZ can be a country with cheap outgoign and expensive incoming.

At the same time, the government should order telecom to enable annex-m, so average users not in UFB areas can have at least 2 megabit upload speed.

Beccara

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Reply # 686165 14-Sep-2012 20:48

And you've done so not addressing any of the concern's, Where exactly do you want to land this cable in the south island? There are major issues with landing down there.

Your talking about better use of a current links but ignoring the fact any decent ISP will still maintain and use these links for backup unless you drive the cost of this AUSouth Island cable by building a protected cable with two landing stations with multiple rings feeding them from the landing points to multiple major population base. Thats assuming you can get enough clients willing to buy into an AU only cable landing on the worst coast line in NZ

Any cable from NZ to AU is overbuilding the SCCN network when the SCCN network is NOWHERE near 100% util and certainly dont get where you think these new markets will come from. Theres no advantage to the rest of the country, Wellington still has to pay the big 3 providers to either get to AKL or CHCH, Same with the rest of the lower north island.

National Transit is one of many issues facing us, it isn't the biggest but it is the one that people are now latching onto as the boogyman now that SCCN/Int Transit can no longer be used without everyone calling them out on it.

You cherry pick item's and fill in blanks with what you think it is. There is no 8Tbit/sec cables operating today in NZ, Even PF was going in for 5.12TBit. So your 8TBit in your math is flawed, The only $ figures with capacity thrown around is $100mill USD with lit 120gbit to start with and capable of 640gbit/sec @ 40gbit/wave right now at unknown cost to upgrade. You've jumped on my quoted 25% figure which I said was upwards - Figures I have at hand for one cable out of AU put O&M costs over the IRU term at %52. You've ignored paying ANY interest on this $100mill aswell over the 25 year lifespan. Assuming a 25 year lifespan aswell since SCCN had a design life of 20 years and recently extended to 20 years. You're also assuming you sell 100% of it. All bad mistakes.

For dose of reality

1.2tbit cable
20 year lifespan
$150mill NZD cost
50% O&M
75% Sold (Still high)

$150,000,000/(1310720*.75) = $152.58/mbit / 240 months = $0.6357 * 1.50 = $0.9536

So $0.9536 + Interest per year on the $150mill loan + rainy day fund.

Add into this that unless you have other cables you own that the Opex for such a cable is likly to be ALOT higher than %50 since the list of things you need doesnt grow too much if the cables 10000km long or 2000km long and this is back of the napkin math likely missing some costs.

People IN the industry doing and dealing with companies doing things are telling you all the time that what talk about simply isnt going to happen and some like me take alot of time explaining it to you, Nobody's going to land in CHCH and by your own words National transit is the issue yet we have 3 major carriers to chose from for Fibre, Alot more running DMR everywhere - They are business's tho yet you seem to expect them NOT to make money so you can provide services where you DO make money

Most problems are the result of previous solutions...

All comment's I make are my own personal opinion and do not in any way, shape or form reflect the views of current or former employers unless specifically stated

mercutio

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Reply # 686176 14-Sep-2012 21:26

thanks for your insightful message beccara.

i think what dong really wants is redundancy. just this year wikipedia had an outage due to two dark fibre pairs being right next to each other and being cut at the same time.

that said 3g internet seemed to work in christchurch when the earthquake happened and there was not even power.

Beccara

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Reply # 686189 14-Sep-2012 21:47

For national transit fire up http://broadbandmap.govt.nz/map-2 and select Fx Networks, Kordia ISN sites, Telecom Group, TelstraClear Fibreoptic, Vector.

This will show you the major fibre network's in NZ and Kordia ISN sites show you their main DMR connection points.

There is certainly no lack of diversity here and between islands you have the Telecom ring from Levin to Nelson and Wellington to Picton along with Telstra's ring and some DMR running aswell IIRC (Note the lack of current cabling into the West coast, A single Telecom loop to Greymouth) Wellington to Hamilton is a massive ring aswell with 3 or 4 loops in between it can take and from there it's again multiple networks with multiple paths into Auckland with an option to dump it onto Vectors network in south Auckland giving you mutliple paths from the Bombays's to SkyTower/NorthCote/Albany etc etc

Hell even little old Whangarei is protected - We had a "spade" fault this week that took out one carriers cable entirely but their diversity path kicked in and nobody noticed

mercutio

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Reply # 686232 14-Sep-2012 22:24

Beccara: For national transit fire up http://broadbandmap.govt.nz/map-2 and select Fx Networks, Kordia ISN sites, Telecom Group, TelstraClear Fibreoptic, Vector.

This will show you the major fibre network's in NZ and Kordia ISN sites show you their main DMR connection points.

There is certainly no lack of diversity here and between islands you have the Telecom ring from Levin to Nelson and Wellington to Picton along with Telstra's ring and some DMR running aswell IIRC (Note the lack of current cabling into the West coast, A single Telecom loop to Greymouth) Wellington to Hamilton is a massive ring aswell with 3 or 4 loops in between it can take and from there it's again multiple networks with multiple paths into Auckland with an option to dump it onto Vectors network in south Auckland giving you mutliple paths from the Bombays's to SkyTower/NorthCote/Albany etc etc

Hell even little old Whangarei is protected - We had a "spade" fault this week that took out one carriers cable entirely but their diversity path kicked in and nobody noticed

what'd kordia extend? i wondered what showed for my place. bush wireless, kordia extend, vodafone 3g, .. i assume all wireless.

there's meant to be fibre that goes past my house to a school though. (not in UFB area)

to my mind residential is where redundancy is important, as it's less likely to get fixed in a timely manner!

DonGould

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Reply # 686266 15-Sep-2012 00:07

BarTender: So... if we all agree the actual issue is the cost of national transit why do you keep on going on about wanting to land another international cable.

What Beccara says makes sense...

Beccara: There's no silver bullet to the issues that UFB will present, It will be a mix of caching at UFB/RBI/xDSL HO points around the country, Local IX's, Smarter Int transit buy's, geographically staggered caching etc etc

It's the 'caching' bit that makes the most sense to me.

The comment about IX's make sense too, and smarter Int transit buys.

This is the stuff that doesn't make sense to me...

Transit clearly has to get more narrow as it runs down the country. It strikes me that there's no balance to the network flow.

From a cache point of view, is there any point in pulling under used capacity from Melb, Ald or Tas?

As has already been said, there's no point in pulling traffic from PPC1, Endv or AJC at all because SCCN just don't make it in your interest, I get that - also already said by someone else.

My point is that if traffic for the south island doesn't have to be pulled from the north then that means thicker pipes to deliver more capacity around the north with out upgrading them - as Beccara pointed out in-directly.

Smaller providers in SA, Melb and TAS are already pulling capacity into their caches in those areas. Those caches are in different time zones to New Zealand. Again, I'm simply suggesting that it makes more sense to me to pull data from those locations than redraw it from .us.

What's more, per all the other coloured lines on the map above, those caches are being feed by smarter int buys, off AJC, Endv, PPC1 as well as SCCN.

Everyone keeps going on about how SCCN give big providers in .au better deals, well I'm suggesting we need a way for our smaller providers here to partner with those bigger providers there to take advantage of those deals.

As Beccara says "Local IX's, Smarter Int transit buy's". He's right.

Pipe built a whole network of local IX in Australia. I'm just wondering if we would get better value if we connected ourselves directly to those IX's.

With respect to diversity and protection. PPC1 is not protected at all. I followed it's development and deployment daily as it was being planned and built. It delivered value to Australia, the value that we don't seem to have here.

Beccara: People IN the industry doing and dealing with companies doing things are telling you all the time that what talk about simply isnt going to happen and some like me take alot of time explaining it to you, Nobody's going to land in CHCH and by your own words National transit is the issue yet we have 3 major carriers to chose from for Fibre, Alot more running DMR everywhere - They are business's tho yet you seem to expect them NOT to make money so you can provide services where you DO make money

Ok, and will all due respect, the tone is getting insulting.

As far as I'm concerned this is a public discussion forum. This thread has had over 2.5 thousand views in a few days and clearly there are people just interested in the presentation of thoughts.

Many people, including myself, would like to just better understand the dynamics.

It's easy to log on to www.whirlpool.net.au and see all the data plans and price points they have there and wonder why we as an industry aren't doing more, something, anything, to get us better value.

The suggestion that I'm attempting to push a barrow that would bring venture capitalists a loss making venture or create poverty in our existing market is a joke.

I've spent over a decade observing countless telco projects do exactly that. It's part of the reason I don't attempt to empower them but do attempt to take active part in up front, open, transparent discussion in the public space.

D

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Beccara

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Reply # 686323 15-Sep-2012 08:47

You aren't listening, You picture shows the 1st and most painful flaw - You are running this cable over land from sea level upto 1.8km above sea level in areas along the alps where you have slips and road closures alot more than everywhere else. Then you stick the other end of it in the wrong location - Sydney is where the DC's are holding the data for everything from Facebook to Youtube to Quickflix, So now as a client of this cable I have to buy transit from Wellington to CHCH and Melb to SYD

Before you get into "This is great for everyone" speech you need to address the landing point which you haven't at all. As everyone is telling you it's insane to land a cable in the South Island for many, many reasons but you dont listen.

It's very simple, NZ simply can't make the business case for another cable right now, Even a "simple" NZAU one. We wont be able to make the case for it for quite some time at minimum and it sure as hell wont be landing on the South Island.

It's not meant to be insulting but you do ignore/cherry pick points. You need to stop talking about what color the house is going to be when you're foundations aren't even sorted out, Ignoring the politics and business of your ideas you have major physical problems stopping you

DonGould

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Reply # 686482 15-Sep-2012 17:00

BarTender: So one could "assume" that the price of wholesale internet by SCCN to NZ is "fair".

Personally I read this like "Don, mate, I'm sorry, but you live in the south, you're poor, your country is poor, you just have to accept your lot in this digital life, you have to know your position..."

It strikes me that our biggest New Zealand telco took a 50% risk in an investment that is delivering Australia value.

As you say, we use 5% of the capacity but our telco invested in 50% of the risk and we, New Zealanders, paid higher telecommunications prices than our neighbours to carry the project while it was not running in profit and now that its costs are sunk, or getting there, we're not seeing the benefits flowing in terms of value.

What I'm reading is that I should just accept our lot in life and be grateful that we even have a cable at all.

I feel a bit like Rosa Parks being told that I should just be pleased that I'm even allowed on the bus at all and need to just accept that I'm black and as such the rules are different for me.

Don't get me wrong BarTender, I'm not suggesting that you are personally doing that, I'm not.

I'm just saying that's how this whole space leaves me feeling.

It seems to me that as a community, there is stuff in New Zealand that we haven't invested in. We've spent the last few years banging on about how the clouds will clear once PF gets its cable delivered.

Are we now going to spend the next 3 years banging on that this project will clear the clouds?

BarTender: Have a look at: http://www.submarinecablemap.com/
And see how it really works in the world.

Yes, the over riding theme seems to be that cables over build cables.

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raytaylor

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Reply # 686524 15-Sep-2012 20:19

Anyone know if Tasman-2 is doing anything other than telephone?

Ray Taylor
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DonGould

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Reply # 686837 16-Sep-2012 20:51

Beccara: You aren't listening, You picture shows the 1st and most painful flaw - You are running this cable over land from sea level upto 1.8km above sea level in areas along the alps where you have slips and road closures alot more than everywhere else. Then you stick the other end of it in the wrong location - Sydney is where the DC's are holding the data for everything from Facebook to Youtube to Quickflix, So now as a client of this cable I have to buy transit from Wellington to CHCH and Melb to SYD

I can see why people keep suggesting landing in Nelson. Clearly there's a pinch point there with all the providers already having network running to the landing station.

Yes, landing in New Plymouth makes some sense as well, Telstra cable direct back to Hamilton and everyone else is running north and south from there too.

I can even see why a Sydney to branched drops to Nelson / New Plymouth makes sense to. As only Telecom and Telstra have cook straight cables, and we know they don't openly peer, so the branch unit could even be used to create a wave length bridge from New Plymouth directly to Nelson which even further opens up the national transit question and provides a third carrier running end to end up and down New Zealand.

What's more, the west coast really is 'blue land' isn't it? Neither FX nor TelstraClear run anywhere near the coast.

I get your point that landing in Greymouth would mean that you either rent capacity off Telecom (which is regulated but we all know is expensive) or over build back to Christchurch, and Nelson as well, which is at least 400km of new fibre runs though some very hard country.

I also accept that landing in Sydney makes sense to everyone because that's where everyone has been locating new caches and VoD services recently, so the very last thing most people are going to want to do is back the building of a new cable to some where else that requires you to then buy Australian national transit just to get back to those spanking new farms.

Beccara: Before you get into "This is great for everyone" speech you need to address the landing point which you haven't at all. As everyone is telling you it's insane to land a cable in the South Island for many, many reasons but you dont listen.

It's very simple, NZ simply can't make the business case for another cable right now, Even a "simple" NZAU one. We wont be able to make the case for it for quite some time at minimum and it sure as hell wont be landing on the South Island.

It's not meant to be insulting but you do ignore/cherry pick points. You need to stop talking about what color the house is going to be when you're foundations aren't even sorted out, Ignoring the politics and business of your ideas you have major physical problems stopping you

Sure, you're quite right.

I've fairly much ignored discussion about how hard it will be to land on the West Coast.

I know it's a tough engineering question which I know little about.

I really don't see getting cables to run the same sort of routes that the existing Telecom ones are, as being to hard, just expensive. Run the cable and then their is a second protected loop with the cables on the east side.

Nelson v's Greymouth Problem

The problem that concerns me is where investment would come from for any new cable.

America?

PF seemed to think they'd raise it in the US. Clearly the Americans have enough issues at home to be bothering to investing in a cable just to over build a cable that's already under capacity.

Clearly, if we want a cable then we have to pay for it ourselves.

If Rod and Sam can't get the cash from .us then who is there with a better chance? John?

Auckland?

Auckland has massive roading issues. I may be crazy in thinking that a cable should land anywhere but Auckland, but I think anyone who thinks Aucklanders are interested in investing in anything other than more roading and some rail is equally bonkers.

Nelson?

I don't see why anyone in Nelson would be interested in the investment, nor is the place big enough to raise the required capital is it?

From Nelson's point of view, they have a Telecom cable that runs to Levin and three networks that run back to Picton to pick up the Telstra cable. How expensive is transit to pick up in Nelson with all that choice?

Christchurch West Coast?

The West Coast is in the news week after week crying out that they need new projects with investment in them because the demand for coal has dropped off from China right now.

Christchurch is going to be over flowing with money as insurance pays out.

In some cases people will just put up new buildings to replace the old ones. But the market has changed for ever because of technology.

Investment in buildings made sense to me 30 years ago. You had to put everyone in the same building, in the same area. The cost of calling from one side of the city to the other was just to expensive at 4c per minute. People held meetings.

Will Christchurch invest in Nelson?

I totally agree that consideration for foundations has to be given before thought of carpet colour.

Before one even considers foundations one has to consider who's paying for this house?

My impression of Christchurch people is that they would see a cable landing in Nelson as an investment in Nelson and not an investment in this part of the country.

Where is the traffic going to come from?

I agree that currently the desired traffic is coming from the east. But I also agree we already have more than enough capacity coming from the east.

Again, in Christchurch we've got a growing Asian population and new cables are being pushed in to Perth from the West.

In considering a new cable for the next 20, 30 or 50 years, I think we have to look at where that traffic demand is going to be, not just where it is today.

Canterbury needs to invest in it self, get people and hold people here.

At present we're all investing in putting servers in the US just so we can then pay to pull our own data back to New Zealand. We're investing in putting servers in Auckland so that we can then pull our data south.

Then we complain about poverty in our city. We complain about the lack of IT opportunity and that our kids are heading off to Wellington and Auckland for jobs.

We complain that Wellington is turning off the investment on the West Coast.

We seem to do a lot of complaining down here.

In my mind, if we want to keep our kids here then we have to take the money from our broken buildings and invest a chunk of it in IT that will link us to the world that is interested in being part of our city - the west.

In summary

I agree, on the surface that the idea of landing a cable in the south does seem just crazy to anyone who's not based in the south.

I agree that it's not simple.

I agree it's not cheap.

I agree that no one from out side the region is going to build a business case for us that also involves potential to take business off those from outside our region.

D

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Ragnor

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Reply # 686974 17-Sep-2012 10:07

There simply isn't enough demand for the private sector to build it anywhere other than Auckland, as we saw with Pacific Fibre even then it's a sketchy business case.

Good luck waiting for the state sector to build a new cable landing somewhere else in the country in the current economic climate, in an industry they have no expertise in and that is not core business.

SaltyNZ

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Reply # 687005 17-Sep-2012 10:51

Ragnor: in an industry they have no expertise in and that is not core business.

As if mere incompetence or irrelevance ever stopped a government from sticking their nose in...

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Zeon

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Reply # 687018 17-Sep-2012 11:24

Ragnor: There simply isn't enough demand for the private sector to build it anywhere other than Auckland, as we saw with Pacific Fibre even then it's a sketchy business case.

Good luck waiting for the state sector to build a new cable landing somewhere else in the country in the current economic climate, in an industry they have no expertise in and that is not core business.

Haha when has that ever stopped the government! National transit costs look to become the key issue. If SCCN is dropping the prices in line with Aus then why not let them build the competing cables and we piggyback on the price drops? The biggest reason I see for another cable is commercial risk for such a key piece of infrastructure and perhaps that is the only reason the government may incentivise a new cable and possibly a different landing point too.

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