Chorus announces second stage of UFB fibre rollout across New Zealand

Chorus has announced a deal with government-owned company Crown Fibre Holdings (CFH) to extend the New Zealand government's ultra-fast broadband (UFB) fibre network to 169 new areas and 203,000 premises across the country.

The second stage of the UFB construction will begin in July this year, and is expected to be completed by the end of 2024 at a cost of between NZ$370 million and NZ$410 million for the communal network, plus an additional cost of NZ$1,500 to NZ$1,700 for connecting each individual premises.

The UFB2 rollout will connect regions throughout Ashburton, Auckland, Blenheim, Christchurch, Dunedin, Gisborne, Greymouth, Hamilton, Invercargill, Levin, Masterton, Napier, Nelson, New Plymouth, Oamaru, Palmerston North, Paraparaumu, Queenstown, Rotorua, Taupo, Tauranga, Timaru, Wellington, Whakatane, and Whangarei, with the full list of areas on Chorus' website [PDF].

Chorus CEO Mark Ratcliffe said many of the regions within the UFB2 footprint are part of the government's regional growth program, which aims to boost jobs and investment in rural New Zealand.

He added that earthquake-affected areas will also be a priority, with Chorus working with local councils and lines companies to establish its fibre deployment schedule.

According to Chorus, fibre uptake across Chorus' UFB footprint was 32 percent as of the end of last year, with monthly data usage averaging 120GB. It is estimating data usage to grow to 680GB per month by 2020. As of October, Chorus began offering 1Gbps services across its entire UFB footprint.

"Fibre is undoubtedly the future of broadband. In the five and a half years that we've been building the UFB network and connecting homes and businesses to fibre, we've seen a huge upsurge in demand," Ratcliffe said.

"Fibre provides the broadband equivalent of an autobahn right to the door of homes and businesses; it will future-proof these communities for the anticipated continued growth in data consumption."

Labour IT spokesperson Clare Curran has criticised the UFB2 announcement, saying New Zealanders should be wary about taxpayer money being used for the project, as the government had said in 2014 that UFB2 would cost only NZ$210 million. Curran was also critical of the time taken for the rollout.

"Many communities that are struggling now with poor connectivity are going to have to wait until 2023-24 to get UFB, which is a lifetime in internet years," Curran said.

"The UFB2 rollout looks good on paper, but it may prove to be a white elephant as competitors move to deliver a better service than a trouble-plagued and stalled government program.

"Under the government's program, those living on the fringes of Auckland, Taupo, Rotorua, Napier/Hastings, Upper Hutt, Nelson, and Queenstown will have to wait until 2024 to get fast fibre. If you live in Kaitaia, Warkworth, Wellsford, Otorohanga, Whangamata, Kaikoura, Culverden, Waimate, Waikouaiti, and many more towns, you'll be waiting until 2023-24 to get connected."

According to Curran, a new piece of legislation currently facing Parliament would allow electricity line companies to string broadband fibre along power lines, which could "outflank" Chorus' slow rollout.

"The fact is that other competitors are likely to deliver fibre faster than the state-funded program, which leaves taxpayers asking whether this money is well spent," she argued.

Meanwhile, the opposition party in Australia is arguing the complete converse: That the government should spent more time to roll out a full-fibre National Broadband Network (NBN), rather than emphasising the faster rollout of cheaper network technologies such as fibre to the node, fibre to the distribution point, and hybrid fibre-coaxial (HFC).

As of October, Chorus' rollout was 58 percent complete, with 480,000 premises passed and 647,000 customers able to connect.

Following complaints about the length of time that consumers are waiting for their UFB fibre to be connected, Chorus in October shortened this wait from 16 days in the July quarter down to 12 days on average, with customers in Auckland waiting just six business days thanks to the uptick in "fibre productivity" due to signing Visionstream as its primary connector.

Chorus also extended its deal with CFH in October to provide its NZ$28 million fund to finance free non-standard residential connections to the UFB network out to the end of 2019.

Under the fund, Chorus provides free fibre installations for premises that are beyond the standard 15-metre distance automatically connected, covering single-dwelling residential units and multi-dwelling residential units with three or fewer storeys that are up to 200 metres from the network.

The UFB will reach 80 percent of the New Zealand population once complete, while the Rural Broadband Initiative (RBI) will provide download speeds of 50Mbps to the remaining 20 percent. The RBI is 100 percent complete, with the project enhancing and extending fixed-line coverage to approximately 110,000 premises for NZ$282 million.

The second stage of the RBI (RBI2) was similarly announced at the end of last year, with New Zealand Communications Minister Amy Adams putting out a request for proposals (RFP) to bring fixed-line broadband services to further regional areas, as well as providing more mobile coverage through a mobile blackspots program.

Chorus said that it intends to take part in the RBI2 RFP.

"Chorus welcomes the government's announcement today about the next stage of the process to extend the Rural Broadband Initiative," a spokesperson for Chorus told ZDNet at the time.

"We will go through the request for proposal and put in a submission by February 2."

The RBI extension would provide broadband speeds of at least 20Mbps.

The New Zealand government is targeting 99 percent of the population with 50Mbps minimum broadband speeds by 2020, with the remaining 1 percent to have speeds of at least 10Mbps.