Industry comment

In the rapidly evolving telecoms environment, all players must be prepared for the challenges brought by constant change. Our consultants offer an expert perspective on the issues that confront the telecoms industry.

Unlocking the “lock-in” RAB regulation

July 8, 2014

Globally regulators use different approaches to impel monopolies towards greater efficiency and fairer prices. Regulatory asset base (RAB) is one such approach which is being increasingly used for regulating infrastructure based industries/sectors. Though its use is relatively new in telecommunications, it has been used for a long time in other sectors including electricity transmission and distribution, gas transmission and distribution, water and sewerage, railways, aviation and postal services.

Pulling the plug on electricity price regulation

April 8, 2014

Regulation aims to balance obligations to both customers and providers. However there are other factors (apart from regulation) that can influence electricity prices. These include changes in demand, generation and legislation. Some countries (such as Estonia, Latvia and Ireland) are abandoning regulation and determining prices based on demand and supply only (with tax regulation). This is due to the preference of regulators for open electricity markets as they believe price regulation can distort the operation of the electricity sector and is a risk to security of supply. However this emerging trend is very slow and it is unlikely that electricity price regulation will be eliminated in the near future.

Crossing lines: how much information should monopolies disclose?

February 11, 2014

In the 2013 Telecommunications Review discussion paper, the New Zealand Government considered that Ultra Fast Broadband (UFB) policy objectives were unlikely to be met without early intervention to prevent reductions in copper wholesale pricing. Specifically the Government feared that Chorus, the largest local fibre company (LFC), would be hard pressed to meet its fibre rollout commitments with the reduction in copper access revenues implied by recent Commerce Commission decisions on unbundled bitstream access and unbundled copper local loop access services. Although Chorus is a private company, Government has made a substantial financial investment in the UFB project and so the ability of Chorus to deliver on its contract is of public concern.

The Smartgrid: powering socio-economic growth

January 28, 2014

The deployment of smart grids by electric utilities worldwide has provided significant benefits to the utilities as well as to the wider communities. Through the ability to deploy fibre alongside their existing networks, and vast experience in the deployment and operation of infrastructure, utilities are able to enter the telecommunications market with ease and compete fiercely with existing operators. It is therefore unsurprising that many telcos have legally challenged such utilities in an attempt to stamp out or delay competition.

Gigatown: New Zealand towns race to a fibre future

January 13, 2014

A 2013 Ericsson study found that doubling the speed of broadband can contribute 0.3% to GDP growth in an economy. The study notes that the benefits of faster broadband can be derived from a number of factors including increased productivity, innovation, increased and better access to services and healthcare, and environmental effects including more efficient energy consumption. With the deployment of ultra-fast fibre broadband in New Zealand we can expect to see similar socio-economic benefits being realised locally. Network Strategies’ study for the Wellington Regional Council found that fibre services offer the potential for transformative change in business processes and models.

LTE vs ARPU – data takes over

December 9, 2013

Now that operators the world over are fully dedicating themselves to LTE investment, with the earliest implementers now four years on, it is interesting to examine the effect this is having on the pockets of both the operators and the users of this technology. We have investigated several of these early movers who implemented LTE in Scandinavia, Australia and the United States to see what has happened to mobile ARPUs over the past four years, what portion of revenue is generated by mobile data, as well as seeing how much a user may be expected to part with per month to utilise this technology.

2013 Pacific Island mobile tariffs update

June 4, 2013

Mobile phones have been widely adopted as a tool for communication and significantly influenced the lives of people all over the world. At Network Strategies, we regularly collect data for mobile services offered in several Pacific countries and compare the prices and affordability of these services. In addition to the fifteen countries we analysed in April last year, operators from two additional countries – Timor-Leste and American Samoa – have been included in our analysis this year.

Affordability of mobile services hampered by quasi-monopolies in the Pacific

March 12, 2013

Around the world substantial increases in the accessibility and affordability of mobile technologies have been achieved through efficient and effective market competition. Increasingly evidence indicates that access to information communication technologies, and in particular mobile services, has a significant impact on economic growth. As a result increasing mobile penetration, affordability and therefore use is becoming important to growth and poverty reduction strategies for development.

International bandwidth for New Zealand: the future without an alternative fibre link

February 12, 2013

Back in early 2010, industry and consumers welcomed the announcement of a new project that would end the monopoly of Southern Cross Cable, bringing better and cheaper Internet for all New Zealanders. A number of successful entrepreneurs, including Sam Morgan, Rod Drury, and Sir Stephen Tindall among others, had embarked on an ambitious project (“Pacific Fibre”) aiming to build a new generation trans-Pacific subsea fibre optic cable linking Australia, New Zealand and the US. This venture proposed to address the future traffic demand by removing the international capacity bottleneck, and finally bringing substantial benefits for consumers, through reductions in retail prices and more generous data caps.

The world of convergence – services, devices, networks and sectors

January 29, 2013

Convergence has become a pervasive trend with the advent of new technologies, enabling “anytime, anywhere” access to resources. It has redefined “communication” by combining telecommunications and broadcasting sectors and offering multiple services using a single device over a single network. For example, today “watching TV”, “accessing emails” and “phone calling” can all be performed on an IP network (instead of traditionally separate networks) using a single device (like a smartphone).

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