2019 / ISSUE 9Championing better broadband for New Zealand

FREEVIEW

Broadcast television moves online

ESPORTS

Online gaming goes professional

INSPIRE NET

20 years from dial-up to fibre

B R O U G H T T O Y O U B Y

Unlocking broadband's

potentialCommunications Minister Kris Faafoi

wants every New Zealander to benefit from faster internet connections

1 EditorialThe Network is the Computer2 In BriefSecurity fears, installs peak, UFB wireless link

16 Rugby World CupThe pressure is on 18 MyRepublicAsia-Pacific's regional service provider

Contents 2019 / ISSUE 9

REGULARS

thedownload.co.nz

6COVER STORY A new Telecommunications Act and issues concerning 5G will keep the Communications Minister busy. He also wants to close the digital divide

33RANTBill Bennett is still waiting for the virtual reality revolution

12

RURAL CONNECTIVITY GROUPAn innovative approach to filling the gaps in rural broadband and phone coverage

28

ESPORTSProfessional gaming has become a spectator sport

10

TV MOVES ONLINEFreeview launches a streaming service that could see an end to satellite dishes and aerials

20 Re:MobileRecycling used mobile phones22 Fibre UnbundlingWhat is it? Why might it matter?24 Inspire NetTwenty years of pushing at technology's edge

9 10Gbps FibreChorus is testing the world's fastest residential broadband

2019 / Issue 9

1

Editor Bill Bennett

Chorus Editorial Consultants Ian Bonnar, Steve Pettigrew, Holly Cushen

Contributors Scott Bartley, Heather Wright, Hadyn Green, Johanna Egar, Holly Cushen, Sarah Putt

Senior Account Director LauraGrace McFarland

Designers Jessie Marsh, Julian Pettitt

Account Executive Paige Fleming

On the cover Photograph by Nicola Edmonds

Published by ICGPO Box 77027, Mt AlbertAuckland 1350, New Zealandwww.icg.co.nz

ISSN 2624-1137 (Print) ISSN 2624-1145 (Online)

The Download is championed by Chorus PO Box 632, Wellington 6140www.chorus.co.nz

The contents of The Download are protected by copyright. Please feel free to use the information in this issue of The Download, with attribution to The Download by Chorus New Zealand Limited. Opinions expressed in The Download are not necessarily those of the publisher or the editor. Information contained in The Download is correct at the time of printing and while all due care and diligence has been taken in the preparation of this magazine, the publisher is not responsible for any mistakes, omissions, typographical errors or changes to product and service descriptions over time.

www.thedownload.co.nz

Connect with usFacebook.com/ChorusNZ Twitter/ChorusNZChorus NZ Limited on LinkedIn

IF THE HEADLINE is familiar, it could be because you’ve been around networks and computers for a long time. The term pre-dates Ultra-Fast Broadband. It even pre-dates the Internet.

The words are almost forgotten. Yet they are more relevant and more potent today than ever before.

They date back to 1984 and a company called Sun Microsystems. At the time, Sun sold a range of expensive, powerful graphics workstations. They were more powerful than that era’s personal computers. Yet that was never enough for the engineers and scientists who used them to process huge data volumes.

In those days, there were small computers – PCs and graphic workstations – and big computers, the mainframes and minicomputers.

Small computers could, in theory, communicate with big computers. It didn’t happen often. Instead, the two types of machines lived most of their working lives in different worlds.

Then something emerged called client-server computing. I’m simplifying here. The idea was that small computers could hand off heavy-duty data processing to larger computers. At the same time, big computers could hand off the graphics processing needed to display the fruits of their labour to smaller computers.

Most of the time, client-server networks were local. They might cover a single building, a factory site or a campus.

When there were wide-area networks, they were exotic and expensive. By today’s standards

they were slow. Often you would use a dial-up connection with a pre-digital acoustic modem.

If you were lucky and had a reasonable budget you might have been able to afford an ISDN (Integrated Services Digital Network) line. This was usually a digital copper link that could run at 64 or 128 kilobits per second.

To put ISDN in perspective, Chorus is testing 10Gbps. It’s a technology that residential customers may soon use to move data at around 100,000 times the data speed of ISDN.

Although the networks were slow, client-server computing was a huge breakthrough. It paved the way for everything connected computers and phones do now. Along the way, we stopped talking about mainframes and minicomputers. We call today’s bigger computers ‘servers’.

We also have server farms and cloud

computing. In essence, cloud computing is the client-server’s great-grandchild.

Today, the network is very much the computer. Want to know something? Use Google or Wikipedia’s networked computers. Want to process numbers? Buy cloud computer time from Amazon or a local cloud vendor. Want to run accounts? Use Xero’s networked computers.

Sun Microsystems understood that in 1984. The company never made it to the promised land. It was wiped out when rivals learned to make servers from cheap, commoditised hardware. It got that strategy wrong, but it saw the potential of networking long before anyone else.

Bill Bennett

The Network is the Computer

The Download | Editorial

'To put ISDN in perspective, Chorus is testing 10Gbps. It's a

technology that residential customers may soon use to move data at around

100,000 times the speed'

2

CHORUS, NOKIA WIN GLOBAL AWARD FOR RBI WORKChorus and Nokia won the Best Broadband Delivering Social Impact award at the Broadband World Forum in Germany. The award is for the two companies’ work on the Rural Broadband Initiative.

This included upgrading 1200 rural cabinets. The pair also delivered fibre to 1000 rural schools and upgraded internet speeds for 110,000 households.

Chorus CEO Kate McKenzie says: “Chorus’ key target of connecting all rural schools was particularly satisfying, as this has resulted in a major long-term benefit to the nation. We are particularly pleased to observe the strong take up of fibre by schools across the country."

One of the side benefits of connecting rural schools is that it enabled Chorus to build fibre-to-the-home connections for many rural communities.

thedownload.co.nz

In briefSecurity fears widespread, safeguards scare Research commissioned by InternetNZ found 94 percent of New Zealanders are concerned about the security of their personal data. The number comes from the organisation's annual survey of internet attitudes.

Although New Zealanders worry about data security, most don't do anything about it. Researchers found few users take practical steps to protect themselves from risk.

Only one-third of New Zealanders surveyed used account authentication, either two-factor or multi-factor. Meanwhile less than half make regular backups.

There is concern about children being able to see inappropriate content online. The survey found this worries 92 percent of those questioned. There are positives. Nine out of ten respondents told InternetNZ internet benefits outweigh

the negatives. When asked to name those benefits, 83 percent named having access to information.

Andrew Cushen, InternetNZ's outreach and engagement director says: "As more and more of our lives are spent on the Internet, being able to access information online has now become a necessity.

"This is why it’s so important that we continue to try and close digital divides in New Zealand. Every New Zealander deserves the opportunity to harness the power of the Internet".

Cushen says people not protecting themselves online is something we need to improve if New Zealanders are to stay safe online.

He says: "We all need to take personal responsibility for our safety on the internet".

The concern over inappropriate content is a reminder that families should talk to each other about the different types of

content and what to do if they come across anything upsetting. Cushen says: "We need to ensure that people of all ages feel safe on the Internet."

Andrew CushenINTERNETNZ'S OUTREACH AND

ENGAGEMENT DIRECTOR

2019 / Issue 9

3The Download | In brief

BY THE NUMBERS

7 percent of Australian broadband users subscribed

to 100Mbps services, compared to

29 percent

of New Zealanders

UFB CONNECTIONS SAW A

10.5 percentINCREASE BETWEEN JUNE 2018

AND SEPTEMBER 2018

In the September 2018 Broadband Deployment Update the UFB network

reported 47.7 PERCENT uptake. The Rural Broadband Initiative uptake was

40.4 PERCENT

Data from the S&P Global market intelligence report June 2018.

BROADBAND TO REACH 99.8 PERCENT IN FOUR YEARSExtensions to phase two of the Rural Broadband Initiative and the Mobile Black Spots programme are set to extend New Zealand's broadband coverage to 99.8 percent of the population within four years.

Crown Infrastructure Partners has signed contracts worth $130 million to provide improved broadband services for around 10,000 rural homes and businesses.

The extensions will also see another 365km of state highways have mobile coverage. Of that, around 100km will be added on the West Coast. A further 59 tourism areas around the country will also get mobile coverage.

Eight new regional wireless internet service providers or WISPs will join the nine who are already taking part in the RBI extension programme.

FIBRE INSTALLS PEAK, UPTAKE CLIMBS Fibre connections on the Chorus network peaked in the first quarter to September 2018. During this period Chorus installed a record 46,000 fibre connections. A further 38,000 connections were added in the second quarter to December.

By the end of the year, fibre uptake had climbed to 51 percent, with demand stronger than during the same period in 2017. With 517,000 connections on fibre, these now make up a third of all Chorus’ 1.5 million connections.

Slower speed copper ADSL connections have fallen by 25 percent for Chorus in the past year. There are now 374,000 connections. Some of this is down to customers moving to the faster VDSL (Very-high-bit-rate digital subscriber line) technology, or to fibre.

There is a clear move to faster plans and greater data use. The number of gigabit fibre connections on the Chorus network now stands at 44,000. That is up 22 percent on the previous quarter. Chorus says most connections, about 71 percent of the total, are now on 100Mbps or greater.

About seven in 10 broadband connections are on unlimited data plans. This reflects the increased amount of data consumed per connection. In the December quarter, the average data consumed across the network was 235GB, up from 221GB in the September quarter.

Chorus says fibre users now average 315GB per month.

Most of this is down to the rise in streaming video. This is reflected in time-of-day statistics, which show average throughput on the network now peaks at around 8.30pm in the evening.

thedownload.co.nz

4 The Download | In brief

Provincial Growth Fund to connect marae to netGovernment will spend $21 million of the Provincial Growth Fund (PGF) connecting marae to the internet and establishing a network of ‘regional digital hubs’.

These hubs will be places where people who may not have internet access can get online. They will offer Wi-Fi and co-working spaces.

The $21 million for regional hubs is on top of the $80 million set aside earlier to boost the second phase of the Rural Broadband Initiative and the Mobile Blackspot fund. Prime Minister Jacinda Ardern says it is part of the government's commitment to bridging the digital divide.

The first marae to receive PGF funding for digital connectivity are Oromahoe (Te Tai Tokerau), Te Houhanga (Te Tai Tokerau) and Raupunga Te Huki (Heretaunga).

CHORUS TESTS GIGABIT WIRELESS STREET-TO-HOME LINK Chorus is testing Nokia's WPON (Wireless Passive Optical Network). It's a wireless technology that connects the fibre network in a street to a home or business when a direct physical connection isn't practical.

Among other places WPON solves many of the problems with apartment buildings and other multiple dwelling units. It also bypasses obstacles like installing fibre along rights of way or getting past difficult neighbours. Chorus also sees it being used for places like business parks.

Nokia's WPON uses the WiGig standard. That's 802.11ad. The same technology is sometimes used to extend the performance of indoor Wi-Fi networks.

A WPON access point can be attached to an access point on an existing telephone pole or lamp post. This connects direct to the fibre running in the street. Customers need an outdoor

antenna connected to their indoor router by an Ethernet cable.

The system uses unlicensed frequencies in the 60GHz spectrum. This is the mmWave or V band. Typically radio waves at these frequencies are absorbed by the air and can be subject to rain fade. They are often blocked by trees. While communications in this band are line of sight only, the distances are small, a few hundred metres at most, which minimises the disruption from air or water molecules.

Chorus says that in testing, WPON manages a speed of around 1.6Gbps over 150m. The theoretical maximum speed is 3Gbps. In other words it can work with any existing UFB plan although, as things stand, it is not suitable for the 10Gbps service that is now being tested.

Ed Hyde, Chorus chief customer officer, says WPON is a useful tool in his company's toolbox and builds on other recent innovations such as 10Gbps services and lower price gigabit services.

IMA

GE

BY S

HU

TTE

RST

OC

K.C

OM

2019 / Issue 9

5

GARTNER: NZ COMMS SPEND WILL HIT $4.4 BILLION THIS YEARResearch company Gartner forecasts that New Zealanders will spend $13.5 billion on technology products and services this year. That's up 2.6 percent on last year. Gartner says the total will reach $13.9 billion next year. With a spend of $4.4 billion, communications services, which was previously the top category, is now second behind IT services. Thanks to cloud computing, IT services will be worth $4.5 billion.

Commerce Commission seeks better reportingA new Commerce Commission paper shows how the regulator plans to monitor how telcos perform when it comes to customer service. Telecommunications commissioner Stephen Gale says: “Retail telecommunications is a Commission priority, in particular in the areas of billing, switching, contract terms and marketing. Parliament has now given us more tools to improve retail service quality and safeguard consumers."

The recently passed Telecommunications Amendment Act means the Commission has to monitor retail service quality. This includes performance, speed and availability, customer service and billing and installation issues. It also means telcos must provide customers with the information they need to make informed choices about technologies and providers.

2DEGREES APPOINTS MARK

AUE AS CHIEF EXECUTIVE

Mark Aue has replaced Stewart Sherriff as 2degrees' new chief executive. Sherriff has retired.

Aue has been the telco's chief financial officer since July 2018, when

he joined the company. Before moving to 2degrees he was the CFO at Vodafone

New Zealand. Has has previously had management roles at Vodafone in the

UK and was a director for Vodafone Fiji.2degrees Chairman Brad Horwitz

says Aue's appointment follows an international search.

Mark Aue2DEGREES' CHIEF EXECUTIVE

Closing the digital divide – it’s a commitment It’s a busy time for the minister. There is the new telecoms act, the 5G networks and the Rugby World Cup on his to-do list. But Kris Faafoi’s biggest focus is on ensuring everyone benefits from the new telecoms technologies, he tells Bill Bennett

2019 / Issue 9

7The Download | Minister Kris Faafoi

Kris Faafoi was appointed Minister of Broadcasting, Communications and Digital Media in early

September. By the end of November, he had shepherded the Telecommunications (New Regulatory Framework) Amendment Act through Parliament.

It was a busy start, yet, he says, it doesn’t signal the end of Government plans for the portfolio. For Faafoi, the most immediate and demanding challenge now is the timely

roll-out of the 5G mobile phone networks. There is also the question of closing the digital divide and of reaping the economic benefits of both the fibre and 5G networks.

But, first, he has to nurse the Act through its incubation period. Faafoi says: “In a legislation sense the regulation is done. That’s great because it gives some certainty for the telecommunications sector. Now we have to make it work.

“Recently we had Telecommunications Commissioner Stephen Gale in here talking about how the Commerce Commission is going to ready themselves for the deadline. We figured out the finer detail of implementing the legislation.”

The Telecommunications Bill is a large piece of work that was started under the previous Government. It, in effect, lays out how the industry will work in the fibre era. With the first stage of the government-sponsored UFB programme due to finish later this year and the second stage due to complete in another two years, we now need new rules and regulations to deal with a transformed market.

Faafoi says: “It’s all new territory. There are lots of components to deal with. From the consumer perspective, there is the retail service quality code and the 111 system. If you look at the legislation from the telecommunications sector end, there’s plenty of detail that they would still like to know. It will take time to get to the point

where we’re happy with the settings. The Commerce Commission will then fine-tune its approach and methodologies.”

The minister draws parallels between the telecommunications and energy sectors. He says there was a long and complex process to go through with the energy sector. “Hopefully, we’ve learnt some lessons from that process, but we expect to have some complex conversations until everyone is happy.”

THE PRESSURE BEGAN EARLY Faafoi’s seat was barely warm before the industry pressure to get moving on 5G started. He says: “In the very first week I got the portfolio, I went and engaged with all the RSPs [Retail Service Providers]. I wanted to get an idea of what was important to them. Spark gave us a clear message. Simon [Moutter, the Spark managing director] isn’t afraid of saying publicly what he wants.”

Moutter wants to have a Spark 5G network in place in time for the 2021 America’s Cup in Auckland. Because of the run up that means by late 2020, less than 18 months from now. The other mobile network operators are in less of a rush.

Faafoi has a measured approach. He says: “We heard Simon, but we also listened to others. One thing is the public conversation about what 5G is hasn’t been had yet, and the technology isn’t here yet.

“As well as speed, we’ve also got to make sure we do it properly. For us, it’s about balancing the needs of the sector. We’ve done this before with 3G and 4G. There are other parts of the puzzle that we have to get right.”

While he acknowledges all the aspirations of the sector, for him the emphasis is on getting things right so that New Zealand can unlock all the consumer and economic potential of the technology.

He says: “While some in the sector want

to get a product out there fast, we want to get the process right in terms of spectrum allocation and what we need to do in terms of our treaty obligations. There’s also an educational job. That’s a piece of work for the sector to do.”

He says there are still outstanding claims regarding spectrum. “We’re at the stage of looking at what our options are to meet them.”

Faafoi doesn’t think this will slow down the 5G process. “We can have conversations concurrently with iwi while talking to the telcos about their build timetables and their aspirations for their roll out. If we are diligent about how we do it, all those conversations can happen concurrently.”

There are politics involved. He says it is important to have a clear focus on what the Government can offer iwi from the start of negotiations. At the same time, he says, “it also depends on us talking to our coalition partners about what’s possible. We’re mindful of keeping all these people happy.”

Fortunately, New Zealand’s telecommunications sector isn’t a political football, as is often the case in Australia. Faafoi sees clear benefits in a broadly bi-partisan approach.

He says: “If you look at the consumer experience, such as New Zealanders’ consumption of the likes of Netflix and other content providers, the fact that UFB is now ubiquitous means that the overwhelming majority of New Zealanders can access those services at good speeds. That’s unlocking the capability of broadband. 5G has the potential to extend that.”

There has been talk of possible industry co-operation on a 5G network build. Faafoi thinks it’s not the minister’s job to get involved in this kind of debate at this stage.

He says: “If there is any concern about competition issues, then the Commerce Commission will take a keen interest in that. The industry co-operation with the RBI [Rural Broadband Initiative], most people think that has been good. Whether something similar could work for 5G is up to the telco sector and whether the benefits work for them.

“The competition side is left to the regulator. It’s also up to the players. I’m sure if they went down that path [of co-operation] the Commerce Commission would keep a close eye on it.”

'There is a clear link between making sure all New Zealanders are able to watch the Rugby World Cup and the more serious

matter of seeing everyone can access the telecommunications networks'

PHO

TOG

RA

PH B

Y N

ICO

LA E

DM

ON

DS

thedownload.co.nz

8

That covers the back end. When it comes to the end users, Faafoi says education is the next step. “Not everyone has a smart TV. If New Zealanders want to watch at home and their TV isn’t smart, they’re going to have to get an upgrade or find a way around this and learn how to use the technology before it starts.

“Eight people in a family all huddling around an iPad is not going to be fun.

“A lot of households will have to clue themselves up about getting signals to their televisions. I’d rather they figure that out early, so they don’t have to sit there with a cold beer at the first game and battle with a remote control or their Chromecast.”

There is a clear link between making

There is another regulatory issue over who gets to build the 5G network. At the time of writing, Huawei appears to be on the outer. Faafoi says the company isn’t banned. “It’s a regulatory process. The GCSB [Government Communications Security Bureau] has given its take on this process. The ball is now in Spark’s court. It can choose to mitigate some of the GCSB’s concerns.

“All the telcos know there is a regulatory process in the TICSA legislation [the Telecommunications (Interception Capability and Security) Act 2013]. Regardless of who the vendor is, they all have to go through the same process. The legislation has been in place for some time, this shouldn’t come as a surprise to them. They’ve all been through it many times before.”

It is for this reason that Faafoi is not worried about existing Huawei telecommunications equipment already in the ground or on mobile towers. “My understanding is that this has already been through the regulatory process. If the regulator has said that it meets the test, it’s [just] an example of where the process has come to a conclusion. There’s a journey through that process for every vendor and we’re at the early stage of that.”

SPORTING ISSUES LOOM The America’s Cup is not the only looming sporting fixture likely to pressure Spark. Later this year the company will broadcast the 2019 Rugby World Cup online.

While some games will also be on free-to-air television, there are fears the event could run into problems. After all, there are precedents. Last year Optus had issues streaming the football World Cup in Australia.

Faafoi says there are lessons from the Optus experience that can be applied to Spark and the Rugby World Cup. After all, rugby is important to New Zealanders.

While he doesn’t think the Government needs to step in, he says his office is staying in close contact with Simon Moutter and his team at Spark.

“We’re asking questions like will everyone who wants to watch it be able to be connected in time?

“I can’t go into detail, but I’m confident that Spark has mitigated concerns in terms of their transmission. The problems Optus faced have been identified and fixed.”

"If our future sense of identity is delivered digitally,

then we can't afford to leave

people out"  

Kris FaafoiMINISTER OF BROADCASTING,

COMMUNICATIONS AND DIGITAL MEDIA

sure all New Zealanders are able to watch the Rugby World Cup and the more serious matter of seeing everyone can access the telecommunications networks.

Faafoi says one of his main goals is closing the digital divide. “The economic driver we want to get out of the digital economy is huge and we want to make sure all New Zealanders have the ability to take part in that. What I see with installs is great, but it’s also about getting a handle on what we can do for under-served families that will make a difference.”

He has taken a close personal interest in the issue since before he became minister.

He says: “I’ve sat on a Computers in Homes’ board for a year and half in my own electorate. I know there are lots of great community-based organisations doing good work to see that refugees, recent migrants and families that are struggling financially can have access to the type of basic kit that allows them to take part [in the community] and, importantly, that their kids can take part.

“They will be working in a world that’s different. If they can’t get in from an early age, then they won’t be prepared for the economy that is ahead of them. If our future sense of identity is delivered digitally, then we can't afford to leave people out.”

The Download | Minister Kris Faafoi

9The Download | 10Gbps

2019 / Issue 9

Ana PesovicNOKIA’S MARKETING DIRECTOR

CHORUS IS TESTING a residential 10Gbps fibre service. It’s the fastest home broadband available anywhere in the world.

As you might expect, 10Gbps can deliver impressive performance. There is enough bandwidth to stream an 8K video alongside four high-definition 4K videos, all from a single access point. You no longer need to wait to play that new 25GB Xbox game. Click download and it will turn up on your console in 20 seconds.

10Gbps is so new that most homes aren’t properly equipped to use it yet. Even the best Wi-Fi router could only distribute a fraction of its available bandwidth around your home. To get the most from a 10Gbps connection, you would need to have a wired 10 gigabit Ethernet network.

That’s still rare for domestic set-ups, and even then there are still bottlenecks. To put 10Gbps in perspective, it is faster than everyday computers write data to their hard drive. Most solid-state drives can’t match the speed.

Around 30 users will be helping Chorus with its trial. One condition for taking part is testers must have a device that can cope with 10Gbps. Eventually, those 10Gbps devices will be commonplace, but not yet.

At first, the service will only be available in Avondale and Birkenhead in Auckland, and Johnsonville in Wellington.

Chorus is working with retail service providers to offer 10Gbps services to testers. 2degrees, 2Talk, Kordia, Orcon, Slingshot, Stuff Fibre and Trustpower are among the RSPs who have signed up to the

by Bill Bennett

trial. Chorus expects others to follow. The 10Gbps trial uses Nokia’s XGS-PON

technology. This upgrades Chorus’ existing fibre network to handle 10Gbps in both directions: up and down. It can sit alongside today’s residential networks and gives Chorus a straightforward upgrade path to offer 10Gbps everywhere fibre is available.

Ed Hyde, Chorus’ chief customer officer, says XGS-PON reinforces its ability to easily upgrade the world-class fibre infrastructure it has been building as the latest technologies become available.

Hyde says New Zealand’s broadband speeds have been rising fast. “In 2011, the average broadband speed was just 10Mbps or so. When Chorus’ fibre plans first launched, in 2012, the top speed then available was 100Mbps. We were then the first to make gigabit fibre broadband

available in 2014. Today this is the fastest growing plan on our network, with more than 44,000 customers.”

Ana Pesovic, Nokia’s marketing director for fixed networks, says her company has 19 deployments worldwide and over 50 XGS-PON trials are underway.

She says industry analysts forecast that XGS could overtake GPON in few years (GPON stands for Gigabit Passive Optical Network). There are a few reasons why this will happen:

First, it means a service provider can offer business products at the same time as domestic broadband. There is no need for two access points. This means higher margins for service providers, allowing them to move up into more demanding enterprise markets.

Another reason is it gives a service provider a competitive advantage. Pesovic says market-leading speeds and high-bandwidth upstream services are increasingly popular with residential customers demanding a premium experience. 10Gbps offers symmetrical bandwidth. That’s an important differentiator for service providers.

She says: “Last, but not least, XGS is increasingly gaining interest for mobile transport. With the imminent arrival of 5G mobile services bringing higher capacity and higher mobile cell density, 10G symmetrical fibre networks can be used for mobile transport. This increases the synergies between fixed and mobile networks, resulting in cost savings and the acceleration of 5G.”

WORLD’S FASTEST HOME BROADBAND FIBRE

GETTING READY FOR

THE DAYS OF aerials on rooftops may be numbered as New Zealand households sign up to fibre-based broadband services and more television content is delivered online.

Freeview has introduced a streaming device called Dish TV SmartVU X, which allows Freeview channels to be streamed for the first time, so there is no need to use an aerial or satellite dish. It is small enough to fit into the palm of your hand and comes with a magnet, so users can attach it to the back of their television set.

thedownload.co.nz

10 The Download | Broadcasting

SIGNALS BIG CHANGES IN BROADCASTING

Fibre is taking over from conventional television delivery, and Freeview is now pushing this move with a new streaming service. Sarah Putt reports

MOVE TO ONLINE TV

Freeview CEO, Jason Foden

It has Wi-Fi capability, and there are plans to enable direct access to an Ethernet port. The device has Chromecast built in, can stream 4K ultra high definition content and its Bluetooth remote control includes voice search.

Consumers with the device can access 12 channels via IPTV (Internet Protocol Television) as well as apps such as Netflix, Lightbox, YouTube, Stuff Pix and more via the Google Play digital distribution service. The Freeview On Demand streaming

service will be added later this year. Freeview was established in its current

form during the ‘Digital Switchover’. This was the government initiative to move from analogue to digital television transmission, from 2012 to 2014. Freeview is a joint venture between TVNZ (45 percent ownership), MediaWorks (33 percent), Māori TV (17 percent) and Radio NZ ( five percent).

Freeview CEO Jason Foden describes the service’s customer demographic as “slightly younger” when compared with the current pay TV subscriber base. “We have engagement with over one million households, that’s about two-thirds of New Zealand homes, with access having grown nine percent since 2016,” he says.

The move by Freeview to offer streaming services is expected to further its reach – and to deliver content from the range of New Zealand broadcasters to more Kiwi audiences. Foden says 10 percent of New Zealand households currently don’t have access to broadcast television via either a UHF aerial or satellite dish.

There are three ‘household types’ in particular that Foden says the new service will appeal to: those living in new builds where fibre has been installed and there is no television aerial; people who live in apartments or in a flatting situation, and people who may want to access television in other parts of the house, such as a second living area with no direct aerial connection.

Foden says while a fibre connection is preferable for consumers wanting to use streaming services, those who don’t have access to Ultra-Fast Broadband services can use a VDSL (Very-high-bit-rate digital subscriber line) connection. He recommends an unlimited broadband plan for “peace of mind”, and he notes that Freeview is “ISP agnostic”, so it doesn’t matter what internet service provider a consumer subscribes to.

Chorus’ network strategy manager, Kurt Rodgers, is enthusiastic about the new service. He says giving users the ability to switch seamlessly between traditional broadcasters and online providers using one remote could be the “gateway drug” to IPTV, especially for those viewers who have so far shied away from online services.

“It’s made for the mass market, for people who aren’t tech savvy,” he says. “All you need is a television, a HDMI (High-Definition Multimedia Interface)

Foden is also open to working with Sky TV and would like to have its content made available via the new service. “We’d love to have Prime on board, and to have Fan Pass and Neon [movies] available on the platform,” he says.

“Our primary focus for SmartVU X is expanding the streaming channels [Prime and Choice] and getting ready for the Rugby World Cup,” says Foden.

While the most popular channels on Freeview are from the major New Zealand broadcasters such as TVNZ and MediaWorks, it carries a number of channels designed for niche audiences. Foden says the move to IPTV presents an opportunity for new content creators who might not be able to afford broadcast transmission. The cost of IPTV delivery is cheaper because with CDN (Content Distribution Network) you only pay for the people who actually watch it.

So, how long before consumers are no

2019 / Issue 9

11

Kurt RodgersCHORUS’ NETWORK

STRATEGY MANAGER

longer able to access Freeview via a roof-top aerial or satellite dish?

Foden estimates broadcast transmission won’t be switched off for at least another 10 to 15 years. The service is owned and managed by Kordia in New Zealand, with broadcasting service provider JDA servicing some of the country’s regions. But, if the Government makes the call to switch off broadcast transmission, there will likely be a mass marketing campaign advising people to take up IPTV services.

Chorus’ Rodgers is more bullish about the end to broadcast transmission – he would like to see it turned off in 2025, when the second phase of the Ultra-Fast Broadband roll-out will be completed.

“I would have thought 2025 is a great time-frame to aim for. The current UFB will be completed in 2022, it seems perfect,” he says.

“Shut down broadcast transmission and the copper network and create a fibre-based digital society. Isn’t that the reason for the UFB? Broadcast transmission is only capable of doing linear TV, it can’t do 4K content, it can’t do Video On Demand. You need an aerial, and, with all the densification happening in Auckland, people aren’t able to get UHF aerials and satellite dishes,” he says.

Other countries are considering switching off broadcast transmission, with Belgium and Switzerland being among the first to make the call. Belgian Dutch-language public broadcaster VRT pulled the plug on its service in December. It claimed it was costing over €1 million a year to sustain and only served 45,000 viewers. And the Swiss public broadcaster SRG says it will terminate digital terrestrial distribution of its television channels (DTT) in June. SRG says only 1.9 percent of households still use DTT and advises those affected to move to satellite, cable or IPTV services.

Both Foden and Rodgers agree satellite technology is likely to exist for many more years because people living in remote locations can’t access the high-speed broadband services needed for IPTV services.

Rodgers says the end-goal for New Zealand should be to push fibre out to 99 percent of the population (when UFB2 is complete it will be available to 87 percent). “But we would always need to acknowledge that there will be that last one to two percent.”

port and a broadband connection. The vast majority of New Zealand homes have those things.”

Foden is ambitious about adding more content – both free and subscriber-based. It currently has Spark’s Lightbox, and Foden is in discussion with Spark about sports content, in particular the Rugby World Cup.

“We’re really keen to offer that service on the IP platform, so this major sporting event can be easily accessed in Kiwi homes. I can’t say 100 percent that it will happen, as we are in conversation with Spark, but we have a mutual aspiration to broadcast a range of content to the broadest possible audience.”

thedownload.co.nz

12

FULL BROADBAND COVERAGE IS

COMING – and rural service choice

Rural New Zealanders will get a choice of mobile network provider once the fibre-and-wireless broadband network covers the country.

Better services should follow. Heather Wright reports

Once upon a time in the world of telecommunications, population coverage was considered a major

competitive advantage. Each mobile network would market itself as covering the area where the largest percentage of New Zealanders ‘live, work and play’. One network even launched with an advertising campaign featuring a Hollywood stunt-woman sitting on a shipping container floating in the middle of the ocean while she talked on her mobile phone.

Now thanks to the Rural Connectivity Group (RCG), coverage is no longer a key differentiator in the telcos’ marketing playbook, at least not for the three mobile network owners (MNOs) Vodafone, Spark and 2degrees, who are equal shareholders in the RCG.

It’s this commitment to providing an equitable wholesale broadband service across New Zealand that attracted Andrew Button to the role of Executive Programme Director of the RCG. He has previously worked for Ericsson and Nokia Siemens and, just prior to joining the RCG, worked with application companies, Mobile Mentor and Blerter.

“As soon as I read about the intent (of the RCG) and the target audience – being a Taranaki guy and having spent lots of

time in rural New Zealand – it immediately appealed to me. Doing something good for the community rather than something that is a business proposition is highly aspirational,” he says.

“With the Rural Connectivity Group, all three mobile network owners are turning around and saying it should be equal coverage for rural New Zealand, and the differentiator will be the services they provide on top of that network.”

WHAT IS THE RCG?The RCG was formed in 2017 as a response to the then National Government’s decision to extend the Rural Broadband Initiative (RBI) programme to 74,000 rural households, delivering a broadband service of around 20Mbps. In addition, the Government created the Mobile Black Spots Fund (MBSF), aimed at providing better mobile coverage on rural highways and at remote tourist locations.

The $225 million contract was signed in September 2017. The bulk of the money, $150 million, comes from three instalments of the Telecommunications Development Levy. This is an annual $50 million industry levy that is due to come to an end in 2019. There is also a $75 million contribution from RCG’s shareholders,

as well as capital that is being provided direct from government agency Crown Infrastructure Partners (CIP).

In December 2018, the Coalition Government announced a further $40 million investment from the Provincial Growth Fund (PGF). This is overseen by Infrastructure Minister Shane Jones. The money will be added to the RBI2/MBSF expansion budget. This is to extend mobile broadband services to more households and bring total broadband coverage up to 99.8 percent of the New Zealand population.

While the RCG has the lion’s share of the contracts entered into by CIP, there is an additional $17.5 million in funding that has been awarded to 17 regional wireless service providers (collectively known as WISPs).

THE ROLL-OUTThe RCG has undertaken to build a minimum of 400 new sites capable of delivering 4G mobile broadband. There is a stretch target of 454 sites to be built by the end of 2022. And there is an expansion programme that will see an extra 120-plus sites built by 31 December 2023.

There will be one Radio Access Network (RAN) unit at every site, which will deliver

The Download | Andrew Button

PHO

TOG

RA

PH B

Y LA

RN

IE N

ICO

LSO

N

2019 / Issue 9

13

"All three mobile network owners are turning around

and saying it should be equal coverage for rural

New Zealand and the differentiator will be

the services"Andrew Button

RCG EXECUTIVE PROGRAMME DIRECTOR

14

mobile and broadband services from each of the three MNOs. From the user’s perspective, this means that regardless of whether you subscribe to 2degrees, Vodafone or Spark, you can use your mobile to make a call when you are in an area covered by the RCG.

For urban folk this might not seem like a big deal, but Button says being able to access all three networks will be a huge step forward for people living in rural and remote areas. “This provides choice for rural residents and workers, and it means rural service providers will remain connected regardless of which mobile network they are presently with.”

In addition to the MNOs’ RAN there will be space at each site for another operator to locate its equipment. This could be one of the WISPs or another entity such as the emergency services, Kordia or business telco, TeamTalk.

Conversely, it may be that the RCG decides to co-locate on a site owned by another organisation. “If the existing infrastructure is in a location that will satisfy our needs and the commercial offer is within the cost of us building our own, then absolutely we will co-locate on someone else’s equipment,” Button says.

Individual site costs vary from less

than $100,000 to over $500,000 and depend on a range of factors such as the remoteness of the location, the cost of gaining resource consent and the availability of electricity. Even the wind can ratchet up the price, as Button

explains. “We’ve got some sites that we are looking at in the Tararua district and its actually the wind loading that will drive the costs of those sites more than any other individual component.”

Then there are the backhaul costs (getting traffic from the rural sites to telecoms hubs). Satellite is the most expensive and delivers the least capacity, so is likely to be deployed for less than 10 percent of sites. Fibre will be used in up to 30 percent of sites and microwave radio technology for the remainder.

Button won’t comment on which technology partner the RCG is in talks with, but it’s probably safe to assume that Huawei is off the list given the Government’s current aversion to its presence in New Zealand. The telecommunications portfolio is now part of Minister Kris Faafoi’s remit, but Button says he works with the Government through CIP, which is also the entity responsible for the Ultra-Fast Broadband roll-out.

RCG employs up to 20 full-time staff (some are still being recruited). It boosts this core team with resources from its shareholding companies, the three MNOs. In addition, there are contractors who work on time-bound projects, such as the programme to integrate the RCG’s network with the three MNOs, and representatives from design and build partners Downer NZ, Connect 8 and Broadspectrum.

"The level of industry and technical

collaboration [two technologies and

three network operators] is not only new for this

country, it may even be a world first"

Andrew ButtonRCG EXECUTIVE PROGRAMME DIRECTOR

The Download | Andrew Button

2019 / Issue 9

To date, the RCG has built three permanent sites – at Raurimu in the Ruapehu district, Kaihu in Northland and Lake Wahapo on the West Coast. All three currently provide 3G services from each MNO.

HAAST SITESThere are also four temporary sites located at Haast and along State Highway 6 on the West Coast of the South Island. One temporary tower, in the Haast township, is supported by three roadside sites. These were installed before Christmas to enable better safety on what can be a dangerous section of the state highway. The roadside sites were each built in a container with a pre-installed antenna, satellite dish and diesel generator.

Once permanent sites are built at Haast, the intention is for the container-sites to be deployed elsewhere. However, 3G connectivity will remain even after 4G is delivered, says Button, because VoLTE, which enables voice services over 4G, can’t be accessed by users with overseas SIM cards, so the company will have to run a 3G service as well. (VoLTE stands for Voice over Long Term Evolution and is the technology used by 4G wireless networks.)

When asked why there aren’t more sites established, given the RCG has been in

operation for over a year, Button explains that as a start-up organisation it had to first establish ‘resource and process’ before specific site acquisition could begin.

“Site acquisition is not an instantaneous process – identifying the location you wish to build a site at, understanding the land-owners’ requirements, engaging with the local community, iwi and government agencies as appropriate, getting the lease approved and then getting the resource consent takes many months,” he says.

In addition, the process of integrating the RCG network with the MNO networks, which each have their own unique architecture, is a big piece of work that isn’t expected to be completed until mid-2019. The first permanent site delivering 4G connectivity can’t become fully operational until this work is done.

“We will end up with a period of time where we are building sites, and then a number of sites will all come online at the same time, once the MNO integration work is completed, and then the programme will flow logically from that point onwards,” Button says.

In January the RCG was ready to begin construction on 10 sites, with another batch to follow. It had lease approval for 54 sites, had gained 47 resource consents and was

actively working on 283 sites of the 454 sites. Button is confident that not only will the

RBI2 be completed on time, it will come in ahead of schedule, a year earlier, in 2021, although he notes there will always be that “hard site” that takes longer to finish.

Even then, the relentless march of technology will likely mean changes are needed. By 2022, 5G is expected to be operational and there might even be a fourth mobile network.

Button says the latest evolution in mobile is part of their “future thinking”, but a new mobile network operator is not. “That doesn’t mean yes, that doesn’t mean no. I honestly haven’t considered that. That’s a question that would need to be answered by the shareholders – Vodafone, Spark and 2degrees.”

Dealing with the task at hand is probably enough to be getting on with. Button says the level of industry and technical collaboration is not only new for this country, it may even be a world first.

“Shared networks have been considered and implemented in many other countries, but shared networks across two technologies, across three network operators, for the geographical coverage we’re looking at in New Zealand? We think that’s actually unique.”

15

thedownload.co.nz

16

IT’S 2008 AND Beijing is hosting the Olympics. TVNZ has the broadcasting rights and, alongside its traditional terrestrial service, is offering an online service. You can log on to the TVNZ website and watch live feeds of the Games from the various venues. The quality isn’t exactly 4K, but it’s better than the dodgy illegal streams and the coverage of events is nearly perfect.

Cut to 2019 and online sports streaming is dominated by the leagues, such as the US’ National Basketball Association and National Football League, and TV operators like Sky. We have neither the same level of coverage or freedom we had a decade ago.

But now New Zealand’s biggest telco is venturing into this space with its new streaming service: Spark Sport. It plans to

deliver what is possibly the most popular sporting event in this country, the Rugby World Cup (RWC). No pressure.

The big question hanging over Spark Sport is: how well will it work? As of now, offering a stable streaming service for live sport is a gamble.

Fan Pass and Sky Go have been maligned in recent years for crashing when they come under any kind of big load – usually during All Blacks games. These failures have left many wondering if Spark is setting itself and rugby fans up for a fall.

Of course, it’s not just rugby. Spark Sport will also have English Premier League football (from August 2019), Manchester United TV, rugby’s Heineken Champions Cup, Formula 1 and the FIH Hockey Pro League. Starting just a month out from the RWC kick-off, the Premier League

will provide not only the load test that Spark needs, but also give an indication of fan satisfaction.

Premier League fans have suffered more than most in recent years with the demise of Premier League Pass followed by the poor implementation of the BeIN Sports’ online option. It’s fair to say then that the current mood concerning Spark Sport is one of scepticism. So, what do we know?

THE SPARK VIEW ON STREAMING SPORTS Spark Sport will be a live, on-demand sports streaming platform built by iStreamPlanet, which currently supports streaming for NBA League Pass and the Olympics. Jeff Latch, head of Spark Sport, says the business chose iStreamPlanet as it has “an impressive pedigree”. It provides

thedownload.co.nz

Spark Sport team

Live RWC – it’s a gambleThe Rugby World Cup is coming soon, but how well will Spark deliver the iconic Big Event. Hadyn Green considers the challenges facing the telco as the pressure mounts

The Download | Spark Sports

THE OLD RIVAL – WHAT IS SKY DOING?Sky TV has long been criticised for its stubborn refusal to embrace streaming. But this is changing. Its Neon movie and television service is no longer the dud it was a year ago – very little HD (high definition) content, expensive and unreliable. It is now a reasonable service worth paying for – especially if you like Game of Thrones.

When it comes to sports, however, Sky keeps making blunders.

Fan Pass was a welcome addition to New Zealand’s streaming market when it was first launched in 2015. At first, fans could buy full seasons of Super

Rugby, Rugby League or F1 racing. The streaming was slightly better than the Sky Go app and the prices weren’t too bad.

The service then switched to monthly, weekly and single day passes. And, instead of individual sports, it offered live access to Sky Sports 1, 2, and 3.

Then, during rugby’s Lions Tour in 2017, Sky decided to change the pricing structure. Single day passes were removed, prices for monthly subscriptions were doubled and six-monthly and yearly options added. The result was a lot of people turning away

from what had been a useful service.Fan Pass remains innovative though. It

is available as an app on most new smart TVs and on nearly all mobile devices. Sky also offers free Google Chromecast streaming video as an incentive. This allows fans to view sports from their televisions. But there is no on-demand version and Sky’s special pop-up channels remain on Sky only.

Sky still owns the rights to a large number of sports, including tennis, golf and cricket, so it’s not about to disappear from the market any time soon.

the streaming platform for a number of large sports events. These include the Super Bowl, basketball’s NCAA March Madness, and the Formula 1 TV Pro channel. Also, its ability to provide support for “a very large number of concurrent users” is impressive.

He says: “iStreamPlanet will provide the bulk of the technical infrastructure for Spark Sport, including video encoding and distribution, user authentication, subscription management and billing, and app development, across a wide range of devices.”

The range of devices is set to expand after Spark Sport’s launch, as will the number of functions.

Latch is also clear that you won’t need broadband fibre to stream sport (although it will help).

“If you do have a slower connection, we will automatically adjust the quality of your stream to fit your connection speed. So, the actual quality of the video you’re watching will depend on the quality of your internet connection – as well as the type and quality of your devices, and your home set-up,” he says. This is already the case for Netflix and Lightbox.

However, there is a back-up. TVNZ will be the free-to-air partner for Spark Sport during the RWC and a number of games will be broadcast over its terrestrial network, including the final. This is not only helpful for those with poor internet connectivity, but also for those who can’t afford a subscription.

Spark Sport will charge $20 a month for all its content. There are no ongoing commitments and it starts with a one month free trial. The RWC will also be offered as a standalone subscription, however, with options for the tournament and individual game passes. There will also be a “freemium” model with some content available even if you don’t want to pay for a subscription.

There will be advertising on the platform. However, there will be no adverts during game play or straight after the Haka. This is currently done well on other international sports streaming sites such as MLB.TV and Rugby Pass, where advert breaks are replaced with either a live feed from the stadium or short highlights.

Latch says: “We believe by making sports content more affordable – through flexible plans and packages – and by offering it over a range of options, for when and where people watch games or events, we are making sport more accessible to New Zealand as a whole.”

TREATED AS PINBALLSIn general, New Zealand sports fans have found themselves being treated as pinballs, knocked around by media companies as they jostle and fight over broadcasting rights. Currently, there are only a few sports available to stream direct from source and most of these are American sports backed by big money. The rest are often the sole domain of pay-TV (tennis, golf, league and so on).

Spark Sport is a refreshing change in the New Zealand media landscape, offering something new and providing some competition for the old guard of sports coverage. Whether the infrastructure will hold up under the strain is yet to be seen – and tested. Early games shown will either be a catastrophe or a triumph.

Last year, during the FIFA World Cup, football fans were furious when Australian telco Optus’ online coverage broke down. Viewers were left staring at “playback error” messages. Optus had to offload the tournament to SBS TV to broadcast the matches. Spark will have observed this – and the damage it did to the Optus brand. It’s likely hoping everything will play out well, even more than rugby fans.

2019 / Issue 9

17

'Starting just a month out from the

RWC kick-off, the Premier League will provide not only the load test that Spark needs, but also give an indication of fan

satisfaction'

PHO

TOG

RA

PH B

Y R

OBI

N H

OD

GK

INSO

N

thedownload.co.nz

18 XXX | XXX

CREATING GOOD HEADACHESAsia-Pacific’s only regional internet service provider (ISP) MyRepublic is growing fast and creating a few benign headaches along the way as it helps boost entrepreneurial culture in the region. Sarah Putt reports

Vaughan Baker is helping cause headaches for his friends in Singapore.

Baker, who previously headed up MyRepublic New Zealand, is now the Singapore-based group’s director for government and corporate relations. MyRepublic bills itself as the first purpose-built ultra-fast broadband provider in the Asia-Pacific region and offers 1Gbps services as its entry level product in Singapore.

“I’ve got quite a few expat mates working in finance, oil and gas and IT, and they dread the day the young smart Singaporeans who work for them say, ‘Boss,

I’m resigning’. And it’s not to go somewhere else. They’re off to give the start-up they’ve been working on in their bedroom a go.

“That entrepreneurial way of thinking is promoted by the fact people have got this always-on connectivity – that’s the base layer. It’s one of the pillars,” says Baker.

“My mates have no choice but to shake their hand, wish them luck and maybe ask if they need any seed capital.”

Singapore is reaping the rewards of its focus on infrastructure (along with the wider start-up friendly environment). The island-state’s start-up companies closed US$1.2 billion in venture capital deals in

2017, according to Enterprise Singapore. Baker believes New Zealand could

reap similar benefits because of the keen uptake of fast broadband here. It represents a “tremendous opportunity” for New Zealand, he says.

His wider view of the Asia-Pacific region has driven home to him the fact New Zealand has a head-start over the other countries that the Singapore ISP operates in – with the exception of Singapore itself.

Singapore kicked off its government-led, nationwide broadband network back in 2006 and has had 1Gbps services, priced at less than S$50 a month, since mid-2015.

Vaughan Baker, MyRepublic group director for government and corporate relations

2019 / Issue 9

19

a compelling case for people to move to fibre, and they’ve done a fantastic job.”

He says the New Zealand telco market is fiercely competitive, noting it only took one to two months for incumbents to adjust their pricing and models to compete when MyRepublic launched here, in 2014. Australian competitors took a while to respond.

While New Zealand, Australia and Singapore have adopted government-led broadband roll-outs, MyRepublic’s fourth market, Indonesia – a country it entered at the request of an investor who wanted the ISP to take over its existing business – has taken a different tack. With no fixed infrastructure in place, companies such as MyRepublic are deploying their own fibre infrastructure. Surprisingly, it’s not as Wild West as you might think, with the companies avoiding overlaying each other

and even wholesaling access to each other to extend their respective footprints.

“Commercial pragmatism is prevailing,” Baker notes.

Despite this, he acknowledges the limitations of the model, noting companies cherry-pick the most economically viable cities and avoid regions that make for less economic success.

“Government involvement pushes the case to work beyond the big cities, taking a longer view of return on investment – or even viewing the return as possibly being a social return,” he says. “It is also very hard to make the case for such a major capital investment without some sort of assistance. Government involvement helps with both aspects of such investments.”

Baker relishes MyRepublic’s role as a challenger in each market. The company’s

“What I like about the ability to be able to offer gigabit fibre infrastructure is the fact it transforms broadband into a true utility service,” says Baker.

“It makes it ubiquitous. It is always on, and however many devices you have connected in the home or business at any one time they will all just perform. For me that makes it akin to electricity – you just flick a light switch and it all happens.

“Singapore has had this for some time and now New Zealand is starting to adopt it.”

1Gbps connections account for about eight percent of Chorus’ fibre base, and between 15 to 30 percent of MyRepublic’s New Zealand sales. Baker is eyeing the day when the ISP only offers 1Gbps here. “Once we do that it becomes this transformative service like we’ve seen in Singapore.”

10GBPSWhile New Zealand’s gigabit offerings are around double the price of those in Singapore, Baker thinks this is a fair price given our country’s geographic spread and rugged terrain. Although he is keen to see prices drop below $100. He dubs this “mass market pricing”.

While New Zealand and Singapore are embracing 1Gbps – and eyeing 10Gbps, with trials gearing up in both countries – it’s a harder proposition for the Australian market. The various access technologies – VDSL, HFC (Hybrid Fibre-Coaxial) cable, fibre-to-the-curb, fibre-to-the-premises, fixed wireless and satellite – create challenges when it comes to delivering the higher speed services.

“In New Zealand we’re not hamstrung that way. [However] in Australia, while some people are getting fibre like in New Zealand, and are able to access those higher speeds, those with ADSL or VDSL are getting maximum achievable speeds of, say, 50 to 60Mbps.”

Baker is adamant New Zealand should be proud of its Ultra-Fast Broadband roll-out and the keen uptake of the service, noting that unlike Singapore and Australia, there is no mandate to move to fibre.

“In Singapore, it’s the only infrastructure, so it is almost mandated that everyone move across to the NetLink infrastructure. And, in Australia, they have a forced migration after 18 months of the NBN [National Broadband Network] being available, with some exceptions. In New Zealand, it has been for retailers to present

goal is to take five percent market share or greater in each country it enters. It is tracking to achieve at least that in all its markets, he says.

“In Singapore, we currently have over seven percent of the market. In New Zealand, we are typically taking around five percent of the market, and in Australia it is the same, although they are sitting at only around 30 to 40 percent uptake [of the NBN] and it’s only that high because of the forced migration.

“In Australia, when we go up against the incumbents, they are trying to make a customer shifting to the NBN see it as no change – just an upgrade of the underlying infrastructure. Whereas challengers are trying to get the customer to see the upgrade as an opportunity to look at new options.”

GOING MOBILELast year, MyRepublic launched a mobile service in Singapore, piggy-backing on StarHub’s network (one of the country’s three major telcos). The company, which recently lost its bid to become Singapore’s fourth mobile operator to TPG, plans to offer a similar MVNO (Mobile Virtual Network Operator) deal in Australia this year. Baker hopes a Kiwi offering will be available in the first half of 2020. (MVNOs lease network capacity and concentrate on offering services instead.)

“A technical person would say all we’re doing is selling a fixed service and a mobile service, but you can tip that on its head and say: We’re going to connect you and your family – how many devices do you want?

“Our mobile service in Singapore operates on the same system as our fixed service, so some people who are brighter than me are able to take it and then package it up in different ways.”

For MyRepublic, MVNO deals are a logical move. The company is firmly of the belief that capital should be used to acquire customers, rather than build networks. Noticeably, New Zealand, Australia and Singapore are all markets where broadband infrastructure is provided on an open access basis, with equal footing being accorded both incumbents and challengers.

And, as for those incumbents, Baker believes they too will increasingly embrace a service model. “They already recognise that they don’t need to own the infrastructure right the way through in order to differentiate their service.”

"That entrepreneurial way of thinking is

promoted by the fact people [in Singapore] have got this always-

on connectivity"Vaughan Baker

GROUP DIRECTOR FOR GOVERNMENT AND CORPORATE RELATIONS, MYREPUBLIC

The Download | MyRepublic

thedownload.co.nz

20 The Download | Re:Mobile

LAST YEAR CONSUMERS got behind recycling. They are no longer being pushed by government or big business. This time the call for change is coming from individuals themselves.

Banishing plastic bags and recycling tin cans and milk bottles is only a small part of the deal. There are still items we think of as throw-away that can be recycled. Mobile phones are a case in point.

Does an image of a discarded Nokia

3310 gathering dust in your bedside drawer spring to mind? Or is a 6300 mouldering under the lounge couch?

Almost all of us are guilty of answering ‘yes’ to the above. But we can do something about it – and help the environment too.

The New Zealand Telecommunications Forum (TCF) officially launched its e-waste recycling programme, Re:Mobile, in 2014. The scheme existed before this – in fact, it’s been around since 2008, but in another

RE:MOBILE – BREATHING NEW LIFE INTO OLD PHONESBanishing plastics is just the beginning with recycling, writes Holly Cushen. Mobile phones are valuable and ripe for proper recycling. This is finally happening

guise. The earlier programme raised money for Auckland’s Starship Children’s Hospital.

In 2016, the TCF partnered with Sustainable Coastlines, a charity that helps look after New Zealand’s waterways.

Geoff Thorn, CEO of the TCF, says Re:Mobile kicked off at a time when the popularity of mobile phones was sky-rocketing. “We knew they were ending up in landfill, and we, as an industry, felt we could do something about that.”

2019 / Issue 9

21

Thorn emphasises that these discarded devices often have valuable components, such as gold or lithium-ion batteries, the latter of which raises safety issues if haphazardly discarded. The proceeds from recycling these phones can now go to Sustainable Coastlines, but only if the phones are disposed of properly.

Thorn explains: “We have an agreement with [Auckland phone recycler] SwapKit, which pays us for the phones it’s able to refurbish. We then pass this money on directly to Sustainable Coastlines. The industry doesn’t keep any of the funds.”

Thorn says about 90 percent of mobiles are reused, which can include being used to provide parts for other phones.

New Zealand is well known for its clean green image, but Camden Howitt, co-founder of Sustainable Coastlines, says that despite having the opportunity to be a world leader in the environmental space, we are simply not there yet.

“This clean, pure, green image really is just that – an image.”

Both Thorn and Howitt agree that the major obstacle to people jumping on board with Re:Mobile is lack of awareness. “It’s about knowing that the scheme exists, realising that your device could have another life, or have value that could do some good,” says Howitt.

“The fact that someone would be willing to throw their mobile into a landfill is symptomatic of the fact that we don’t value the resources that go into the products that we use,” adds Howitt, touching on the need for greater consumer appreciation of so-called disposable products.

However, Sustainable Coastlines is making significant inroads. The charity now runs over 700 well-attended events and educational activities every year. And, thanks to programmes like Re:Mobile, is making real progress in generating awareness for the need to respect our waterways and consider the impact we are having on our environment.

Since Re:Mobile began, it has raised over $2.5 million for New Zealand charities. More recently, Re:Mobile has raised $100,000 for Sustainable Coastlines, which, in turn, has resulted in more than 10,000 trees being planted beside our waterways. Howitt sees this as a win-win. “It’s good in the sense that consumers are contributing to sustainability and these materials aren’t going to waste.”

And it may be that, in terms of e-waste, mobiles are just the tip of the iceberg.

“As mobile phones mature and become increasingly essential to our daily lives, people are starting to place greater value on them and hold on to them for longer,” says Thorn.

Camden Howitt, co-founder of Sustainable Coastlines

Geoff ThornCEO OF THE TCF

It’s likely that another form of e-waste, modems and routers, is going to be the next big ticket resource.

Thorn says this is very much in the TCF’s sights. “We’re looking at this right now. Every time somebody changes their broadband access technology – and some people are doing it two or three times – they get a new modem. Everybody I talk to says they have two or three modems under the bed.”

But this presents a new challenge: “The difference is that collecting and recycling these actually incurs a cost,” says Thorn. “The difference between mobiles and modems is the ability to refurbish a phone and get a return on it.”

In the meantime, Thorn says they are still trying to get those old Nokias from out of drawers and back of cupboards and into the Re:Mobile recycling programme.

World Environment Day, on June 5, will see a huge push for the recycling scheme, and with over 1200 collection points being set up across the country, and freepost envelopes available, it’s going to be hard to claim ignorance for much longer.

thedownload.co.nz

22 The Download | Unbundling

From January, service providers will be able to buy unbundled fibre, writes Bill Bennett. What does this mean? How might unbundling change the way households and businesses buy fibre services?

NEW ZEALAND’S REGULATED telecommunications regime splits the fibre market into wholesale and retail segments. Wholesalers like Chorus, Enable, Northpower and UFF can’t sell direct to customers. Instead, they provide wholesale services to retail service providers or RSPs. This model levels the playing field for retail telecommunications companies.

NETWORK LAYERS Until now, the UFB focus has been on what are known as Layer 2 services. The name Layer 2 comes from the OSI or Open Systems Interconnection model which describes how networks operate. There are seven OSI layers. For our purposes, only the first two layers are interesting. Layer 2 is all about moving data between two points in a network. On New Zealand’s fibre networks this means wholesale companies sell pre-packaged, ready-to-run services that move customer data. We call this bitstream access.

RSPs take these services and, in some cases, rebrand them. In other cases, they might add further services of their own, such as video-on-demand, before selling them to their customers.

Most ready-to-run packaged services

are a combination of upload and download speeds. There is a range of options, but these are limited. Popular Layer 2 fibre services in New Zealand are 100Mbps down and 20Mbps up, or 1Gbps down and 500Mbps up.

The wholesale fibre companies use their hardware and software to create bundled services. Bundled services sit on top of Layer 1. This is the physical fibre connection without any added optical or electronic hardware.

PHYSICAL CONNECTIONUnbundled fibre is when RSPs buy Layer 1 access only. In practice, this means they

rent the physical fibre connecting the hardware and equipment they provide at their customers’ premises.

RSPs who buy unbundled fibre aren’t limited by the Layer 2 choices offered by wholesalers. They get to determine the services they sell the customer. It also means they take full control of the customer’s traffic. Every link in the chain is their responsibility.

Because they are free to create their own packages, unbundling companies often talk about being “free to innovate”. In practice, there’s not much room to manoeuvre when pushing binary digits through a pipe.

They can’t make the pipe bigger, but they can decide how a pipe is divided up. And they can’t tinker with the laws of physics to quicken the speed of light.

Unbundled RSPs are not restricted to the services that come from Layer 2 wholesalers. This means they can construct unique broadband plans. If, say, it turns out that consumers want 630Mbps down and 47Mbps up, an unbundled RSP can meet that demand.

With the market moving towards unmetered plans and gigabit speeds, innovation is often more a matter of what

UNTANGLING

FIBREUNBUNDLING

'Subloop unbundling is

a refinement of copper unbundling

that gave RSPs access to roadside

cabinets'

2019 / Issue 9

23

an RSP can take away from, not what it can add to, UFB.

According to research company Analysys Mason, one consequence of fibre unbundling is that service providers find it harder to differentiate products based on speed. In the end, they usually gravitate towards offering the network’s maximum performance.

THE DIFFERENCE BETWEEN COPPER AND FIBRE UNBUNDLINGFibre unbundling is new, but we’ve been here before with copper networks. New Zealand regulated the Unbundled Copper Local Loop or UCLL after the 2006 amendments to the Telecommunications Act.

The legislative changes that year also introduced UBA or unbundled bitstream access. In most respects, this resembles the UFB Layer 2 services offered on today’s fibre networks.

Copper unbundling worked well for some RSPs. It meant they could install their hardware in Telecom’s exchanges and serve their customers over the copper network. The Commerce Commission regulated the price. The regulator set

these prices after looking at comparable markets elsewhere in the world. It was also a considerable discount to existing access prices.

RSPs unbundled around 100,000 copper lines out of a total of 1.8 million. While that’s not many, it had an impact on the market.

Subloop unbundling is a refinement of copper unbundling that gave RSPs access to roadside cabinets. It didn’t prove popular, largely because of the economics of dealing with 8000 cabinets as opposed to a few hundred exchanges.

To a degree, New Zealand’s broadband competition took off after copper unbundling. There are many reasons. First, Telecom was a monopoly network owner and a retail service provider at the same time. It was in direct competition with its wholesale customers. UCLL diminished that advantage. It gave service providers an alternative route to market. The gap between the UCLL price and the UBA price left RSPs with enough margin to make investment worthwhile.

New Zealand had hundreds of telephone exchanges where unbundlers could install their kit. (In comparison, the UFB network

has 22,000 sites where unbundlers might install fibre-splitters.)

RSPs wanting to unbundle copper could cherry pick and only unbundle the most lucrative ones. In most cases, this meant exchanges where they already had a critical mass of customers. This would guarantee a return on the investment. It also reduced their risk and the cost of installing the necessary network hardware.

In most cases, customers were unaware whether they were on an unbundled line or not.

ECONOMICS OF FIBRE UNBUNDLING Much of the recent discussion about fibre unbundling assumes it would be like copper unbundling.

While there are similarities, there are also differences.

One consumer benefit of unbundling fibre is that Layer 1 access means the connection is not priced on bandwidth. In other words, the wholesale access price doesn’t change depending on speed. This is likely to accelerate users moving to plans that offer the highest speeds.

There are other differences too. Copper connections entering homes

and offices terminated in a traditional telephone jack socket. Customers could plug in their own ADSL, VDSL or other modems to this jack. Often, RSPs provided customers with wireless routers as part of a subscription package. But as the technology was standard, customers could buy routers off the shelf too.

Fibre connections need a fixed optical network terminal or ONT. This is usually hard-wired. Fibre companies install and own ONTs.

An RSP wanting to connect a customer could, in theory, buy the ONT from the fibre company that provided it. Or the RSP might choose to install its own kit. This is more likely as it gives the RSP more control.

OVERSEAS FIBRE UNBUNDLING Singapore is the only overseas market that already has significant fibre unbundling along the lines proposed for New Zealand. It’s a city state, with only 10 exchanges serving its entire population. There, the price of a gigabit fibre connection is about six times the price of a 100Mbps connection. In New Zealand, the gigabit price is less than twice the price of a 100Mbps connection.

thedownload.co.nz

24 The Download | Inspire Net

Inspire Net’s CEO and founder, James Watts, combines a vision of where the internet is going with a robust can-do

attitude. He talks about the company’s 20 years of pushing against the edge of technology

KNOWING WHICH WAY THE

wind is blowing by Johanna Egar

2019 / Issue 9

25

The winds that buffet Manawatu’s remote farms test the sturdiest wind turbines.

Inspire Net recently installed two ‘indestructible’ turbines, to power its most remote wireless broadband towers. They broke. CEO James Watts told the 'indestructible' manufacturer: “They’re dead”. He went on to help him design a more robust one.

Using wind turbines to power wireless broadband stations is still new, but Inspire Net is already using quite a few.

This bold, practical approach is typical of Watts. He talked to The Download about Inspire Net, which recently celebrated its 20th birthday.

Watts always seems to have known which way the wind is blowing – and often worked this to his advantage. For instance, Inspire Net was born in 1998 when he began charging $35 a month for a dial-up service, while Telecom was charging $279.

“I was fixing my dad’s computer one night and on hold to Xtra for nearly four hours, and I said, ‘Ah, scrap this, I’ll do

it myself.’ So, I got some phone lines, a modem bank and a connection to the internet, and started selling it to all my neighbours.”

Watts has always been a technology buff. He built his first simple computer when he was eight. Later, while working as an electrician at Massey University’s Palmerston North campus, he got early internet access.

“I was using it before it was commercialised. I knew that connectivity changes lives. But people couldn’t afford to connect. I had a vision of where the internet would go before the average person thought it was cool.”

This combination of foresight and can-do attitude saw him build a city-wide fibre network in Palmerston North in 2003. Watts wanted to connect Inspire Net with Wellington’s Paradise Net (run by a friend) but Telecom wouldn’t sell them the lines, so Watts took advantage of the city centre’s re-development that was underway.

“The roads were being dug up, so the [service] trenches were open. We’d doddle

along with a six-pack of beer and ask if they’d lob our pipes in. We did that for two years and everyone kinda laughed. Then we employed a digging contractor to join all the bits of pipes together. We had a whole city network a month after that.”

Inspire Net ended up partnering with Palmerston North City Council and building the council’s CCTV network. In return the council put Inspire Net’s fibre in the ground.

This was opportunist too, albeit it for a sad reason. “One of our staff members was assaulted in the square and lost partial vision in one eye. The city couldn’t afford to build a CCTV network,” says Watts. “So, for us, it’s a very symbiotic relationship.”

In another twist, the university and the army, whose students and recruits would often come to blows in the city square after pub closing time, are also now big customers. Watts says the CCTV-covered square is much quieter these days.

Inspire Net installed Wi-Fi on the university campus for both its students and the army recruits there – the army worried about its student-soldiers feeling isolated.

"The roads were being dug up, so the [service] trenches were open. We’d doddle along with a six-pack of beer

and ask nicely if they’d lob our pipes in"James Watts

INSPIRE NET’S CEO AND FOUNDER

thedownload.co.nzthedownload.co.nz

26

Inspire Net now has 2,700kms of fibre. It starts in inner city Palmerston North and goes out to Taihape. It also travels from Norsewood to Masterton. An important part of this network is rural schools and remote farms. These are connected by fibre and by wireless broadband when the former is impractical. In fact, Inspire Net’s wireless network with its 518 towers (wireless stations) is as important as its fibre network these days.

Hooking up schools is also a big part of Watts’ vision for connectivity. “You can educate people and give them access to knowledge. The internet is probably the ultimate way to do this,” says Watts.

Inspire Net was a pioneer in connecting up schools. “We did this well before government had ideas that schools should have fibre.” Indeed, former Prime Minister John Key was so impressed that he ‘cut a ribbon’ at one rural school, Watts says.

COCKIES AND SCHOOLSThen there are the farmers – the “cockies”, as Watts calls them. “They are hard to get on board but once you do they’re loyal ever afterwards,” he says. They were reluctant at first. Then Inspire Net started a community partnership programme, called Community Champions. This involves farmers banding together to get connectivity.

“If there are 10 of them we build a tower for free and hook them up based on future revenue. Then they’ll go, ‘There’s Sue down the road who has two children and they need the internet. How do we connect them?’ After you do this, they are loyal forever because you’ve invested in their community.”

It was servicing this dispersed rural community that led to installation of those robust wind turbines that now power the more remote wireless stations. This happened when Inspire Net found solar wasn’t powerful enough to transmit radio signals as far as they needed to go in some areas.

The robust turbine developed has “a full autonomous power system. This means we can install small wireless repeaters and go places people say it’s not possible to go,” says Watts.

Rural Broadband Initiative (RBI) funding of $1.7 million is helping fund the upgrade of the network. It will see 85 towers upgraded between now and September in time for the Rugby World

"I spend two days a week on a hill-top

mixing concrete, putting in poles,

talking to farmers, putting fibre

in. What I enjoy is connecting

people and changing

their lives"James Watts

INSPIRE NET’S CEO AND FOUNDER

Cup, to ensure even the remotest fans can enjoy shouting at their teams. Inspire Net has even been helicoptering in gear to sites, to speed work up, rather than using the usual quad bikes.

‘THINGS I HATED DOING’ Watts’ aim of connecting people lies at the heart of his business. And, at Inspire Net’s Palmerston North base, they take helping customers very seriously indeed on the 12-strong help desk.

“We have humans who answer the phone,” says Watts. “The person who answers isn’t a scripted flow-bot. We have 98 percent customer satisfaction because we employ on people skills, not computer skills, which are easy to teach.” The WISP received a 98 percent score from Consumer NZ in 2016, and 99 percent for customer

service. The average was 50 percent. Despite this emphasis on the customer,

Watts recently handed over the general manager job to his brother Paul, who, he says, was managing 100 staff before coming on board.

“The things I hated doing were HR and managing people. I decided I should take all that away from me for the good of the company and work on the business instead but also do the things I enjoy.

“I spend two days a week on a hill-top mixing concrete, putting in poles, talking to farmers, putting fibre in. What I enjoy is connecting people and changing their lives.”

Clearly a vision man, what’s next for Watts and Inspire Net? Surprisingly, a mix of old and new technology services. The company is building a digital Citizen’s Band network for its farmer-customers, to ensure their safety.

New regulations mean remote workers must be contacted every 30 minutes to ensure they are okay. But there’s no cell-phone coverage for two-thirds of the places we go, says Watts. The solution – a tier-two digital mobile radio (DMR) network that effectively has GPS tracking and can call out to the cell-phone network if necessary.

And, when it comes to newer technology, Watts is interested in Internet of Things (IoT) applications – with reservations.

“We can put 500 sensors on a farm, but unless someone collects the data in a usable form it’s pointless. The question is: do we collect the data and give farmers a view of it, or do we partner with the likes of Microsoft, who will be building solutions for farmers to do this?”

Watts has concerns about the way big data is currently collected. It’s being abused because data ownership isn’t clear, he says.

On a more positive note, he is excited about the next stage of technology development now that fast broadband is in place. “We have a problem in New Zealand,” he says. “The population isn’t big enough for the big, fun things, so we tend to build for the American and Chinese markets.

“I have a few ideas where we are going next,” he adds, but won’t elaborate beyond his comments on IoT’s possibilities – and big data dangers.

Sounds like a case of ‘watch this rural space’.

The Download | Inspire Net

2018 / Issue 72019 / Issue 9

27PH

OTO

GR

APH

S BY

JAM

ES W

ATT

S A

ND

KEV

IN B

ILL

PHO

TOG

RA

PHY

Esports – the business of competitive, professional video-gaming – is an increasingly important cog in the now

US$134 billion dollar video games machine. A far cry from the clichéd vision of

basement-dwelling loners, these days competitive gaming has evolved from a simple pastime into something that more closely resembles the business of traditional sports, and it’s attracting big money and huge audiences.

Universities (including some in New Zealand) now offer scholarships to esports players. The top tournaments have massive prize pools (the largest topped US$25 million in 2018) and pro-gaming has become a legitimate career path for the best players.

'Blizzard, maker of the wildly

popular World of Warcraft, among

other games… [now] has a dedicated esports arena in

Los Angeles'

28

Esports will even feature at the 2022 Asian Games, and it is being considered as a demonstration sport for the Olympics. This is starting to sound serious.

As a business, esports has become a very big deal. Live streamed esports events are attracting the kind of online viewership many traditional sports would love to enjoy. The 2017 League of Legends final alone was watched by 58 million people – a number advertisers understandably find rather interesting.

While many of the impressive statistics floating around esports emanate from Asia and North America, New Zealand is catching up and now boasts a healthy, albeit significantly smaller, pro-gaming industry of its own.

BEYOND THE BASEMENT GAME

Esports is big and getting bigger. Can it challenge traditional sports in New Zealand? Scott Bartley finds out what is happening

in the surprising world of professional gaming

thedownload.co.nz

2019 / Issue 9

29The Download | Esports

Here, a governing body (the New Zealand Esports Federation) has been established, providing that vital guiding hand any sport needs to grow. There is a dedicated esports tournament host and broadcaster, providing a central hub for fans to watch the best local talent in action. And even the old school of the broadcasting world, Sky TV, has got in on the esports act. What’s more, the New Zealand Breakers basketball franchise launched its own esports division – called The Breakaways – in 2018.

FROM GAMING TO ESPORTSBut what exactly is esports? Freddie Tresidder is general manager of The Breakaways and sees a massive difference between recreational gaming and esports. He uses the analogy of comparing someone having a kick around in the backyard to Manchester United FC... one is a game, the other a full-fledged sporting business. Gaming is no different.

“We treat our pro gamers like athletes,” says Tresidder. “And, in return, they can expect to be treated like professional sports people. We schedule training sessions, monitor what they’re eating and their lifestyle, and in return they get all the resources they need.”

Set up in 2018, The Breakaways is the first truly professional esports team in the country. Before that, esports teams tended to be amateur affairs started and run by enthusiastic gamers who found sponsors to help pay their costs.

With a current roster of 23 gamers, both male and female, plying their trade in various games, this new addition to the local esports landscape means elite New Zealand players can attend tournaments around the world without having to fund going themselves. It’s serious stuff and a significant investment for the club, which is why there is now a specialised training facility at the club’s Auckland base. These players are expected to perform.

Why the interest? Ironically, part of it comes back to how the internet is killing off television. As the under-34s ditch broadcast television in droves, it means they are also missing out on watching traditional sport – like basketball – being played.

This fact hasn’t gone unnoticed by the world’s sporting franchises, and many of them are addressing this by starting their own esports teams to re-establish that link

CYCLING CREATES ESPORTS VIRTUAL WORLD TOUREsports isn’t all controllers and thumbs. Take Zwift, for example. Zwift is a global, online cycling game that lets people race with anyone around the world. The difference here is that riders need to plug their bikes into a smart trainer that connects to their PC or iOS device and then actually push on the pedals to move their virtual bike.

The experience is so realistic that UCI World Tour pros use the game to

train for real-world races. In fact, it has now reached the point where cycling’s governing body, UCI (Union Cycliste Internationale) is creating a set of official rules covering esports via digital platforms like Zwift.

And Zwift itself has started the world’s first dedicated esports competition, featuring professional cycling teams racing for real money.

thedownload.co.nz

30

When it comes to watching live gaming, Twitch is top dog. The Amazon-owned streaming service lets anyone broadcast their gaming content to the world. And, just like YouTube, those with large followings can make a decent living (a cool US$250,000 a month if you’re number one).

According to Twitch, at any given time of day there are at least one million viewers tuned in, watching some of the 434 billion minutes of content served up each year. All the viewer needs to tune in is a web browser. It’s all free.

Competition in this space is revving up though, with other big guns in the tech business trying their level best to “do a Twitch”. Microsoft, YouTube and Facebook are all clamouring for a slice of the action, some even luring the top ‘Twitchers’ away with lucrative contracts.

sponsors, as well as creating a portal for the fans.

An interesting twist to this tale is the role Sky TV has played in helping attract sponsors and advertisers to esports. By the end of 2018, LPL had made some 65 esports broadcasts for Sky. An old-school pay TV broadcaster isn’t exactly the first place a cord-cutting, under 34-year-old heads to for live gaming content, but Mutu speaks positively about how Sky has helped get esports to where it is today.

“There was pretty much no one in the world putting video games on linear TV back in 2015. It just wasn’t happening. The very first event we did, we got together the best teams in New Zealand for League of Legends and did a deal with Sky TV. That made us one of the first territories in the world to do a live linear TV broadcast and that fast-tracked us to where we are today. People were interested, wanting to know

between their core business and younger viewers. For example, almost every team in the American National Basketball Association now runs an esports team.

The tournaments themselves are no laughing matter either. Ranging from one-off local events, to regional qualifiers through to global finals, esports competitions tend to be held at real-world venues, rather than online – it eliminates lag and cheating, and creates quite a spectacle.

Some of the largest tournaments are run by the game publishers themselves as a kind of promotional tool for their products.

Blizzard, maker of the wildly popular World of Warcraft, among other games, has become so massive, and esports so vital to its success, that it has a dedicated esports arena in Los Angeles. Here it hosts events with all the pomp and ceremony the grandest sporting events can muster.

New Zealand doesn’t have the scale for that kind of event. However, local tournaments here can still be significant. Gaming and esports events specialist Ping Zero hosts a number of tournaments each year. The most recent, at Eden Park, drew over 300 players.

Perhaps the biggest player in this market locally is Let’s Play Live (LPL). LPL is a dedicated esports tournament host and broadcaster that has quickly become a major player on the burgeoning local scene. Stashed away at the base of Auckland’s Sky Tower, LPL runs a purpose-built gaming studio crammed with high-end gaming PCs, Xboxes and PlayStations. From its base it can host – and broadcast – coverage of games between New Zealand’s top gaming teams. Think of it as Sky TV and Super

Rugby rolled into one – they don’t own the teams, they just run the tournaments and broadcast them.

Duane Mutu – LPL co-founder and board member of the New Zealand Esports Federation – explains the role LPL plays in the local esports landscape.

“LPL operates a level above the teams and players. We’re there to create leagues and tournaments, so there’s a consistent pathway for New Zealand’s best gaming talent to follow.”

LPL packages this up into highly polished live coverage, complete with commentators and all the bells and whistles expected of modern live broadcast sport. It’s then pushed out over the internet, for free, via a popular esport streaming site called Twitch. Mutu says that by creating such a professional looking product, it helps the overall esports scene by making it a more attractive prospect for advertisers and

Top five most watched esports on Twitch 1. Counter-Strike: Global Offensive 2. Dota 23. League of Legends4. Hearthstone5. FIFA 19

*Source: newzoo.com – for December 2018

The Download | Esports

THE RISE OF TWITCH AND THE DIY BROADCASTER

31

2019 / Issue 9

how and why we did it,” says Mutu.“Now, suddenly, we’ve got this esports

landscape in New Zealand that’s looking very mature on a global scale. We’ve got this audience that’s used to seeing esports sitting next to rugby or cricket – that’s very important because it breaks down those stereotypes.”

For the players themselves, this legitimacy equates to new career paths opening up, and in a world where robots are taking jobs that can’t be a bad thing. As if to emphasise this point, Waikato University recently began offering esports scholarships for school leavers. The university’s director of student services, Mike Calvert, explained to Stuff last year that “there are genuine career paths for people in esports. It would be almost negligent not to engage with it.”

With the top players banking over US$4 million in the past year, there is no shortage of motivation for players to train hard.

“On a global stage, the earning potential is limitless,” says Tresidder. “There’s a North American League of Legends league, where the minimum player salary is $120,000 a year, not including prize money. Obviously it’s a bit smaller in this part of the world, but we’re confident we can get to a point later this year where every single one of our players under The Breakways’ umbrella will be a full-time player on a full-time salary.”

In terms of how much The Breakaways earn, Tresidder is staying mum, but it’s fair to say these guys aren’t rich, not yet anyway. However, Tresidder did say that the players on contract are afforded opportunities to train like athletes and attend overseas tournaments that would otherwise be out of reach for them. Tresidder says that remuneration is different for each gamer on staff and ranges from salary in some cases, to providing travel to get to the big overseas tournaments for others.

“A lot of these guys and girls are university students, or finishing high school or are working part time anyway, so for them it’s not a requirement to get a pay cheque. For some of the teams, we pay them week to week during the season. For others, we’ve built a deal that helps them get where they want to go as a player.”

While it has big expansion plans, Tresidder says the club is taking a cautious approach, so it remains sustainable. It cites the failure of many sporting franchises over the years – both traditional and esports.

"Now, suddenly, we’ve got this esports landscape in New Zealand

that’s looking very mature on a global scale. We’ve got this audience that’s used to seeing esports sitting

next to rugby or cricket"Duane Mutu

LPL CO-FOUNDER AND BOARD MEMBER OF THE NEW ZEALAND ESPORTS FEDERATION

thedownload.co.nz

32

According to Mutu, there were some 470,000 esports consumers in New Zealand last year. Many of these can’t be reached by traditional media channels. For this reason, the bulk of income for esports in New Zealand comes by way of sponsorship and advertising.

“The reality is that sponsors and advertisers are where most of our income comes from. But we’re starting to see advertisers come in that aren’t endemic to gaming, brands like Carl’s Jr and Hell Pizza have jumped in to support LPL, which shows how the appeal of esports is growing.”

GRASS ROOTS APPROACHTech giant HP has a significant presence in esports in New Zealand. Jason Spiller is responsible for esports’ relationship with HP in New Zealand and says that, locally, the company takes more of a “grass roots” approach. By this he means they are not throwing money around, but, instead, are taking a more targeted approach to getting a return on investment.

“I’m looking for organisations that have a growing community and fanbase that has built up over time. We have about 15 gaming organisations we sponsor in

The Download | Esports

New Zealand and we picked them because of their community. They have strong Twitch followings and they really know how to get in there and engage with the audience that we’re trying to target.”

He says that traditional forms of advertising simply don’t work for the gaming audience, “TV, for gamers, is largely irrelevant”.

Given the sheer scale of gaming, both in terms of players and viewers, esports looks to be a veritable goldmine for sponsors and advertisers trying to reach the hard to reach under-34 age group. With the huge predicted growth of global esports – it is expected to become a US$1.6 billion industry within the next two years – esports looks as if it’s here to stay.

2019 / Issue 9

33The Download | Virtual Reality

LIKE MOST YEARS, the 2016 Mobile World Congress in Barcelona devoted an exhibition hall to phone makers.

Everyone except Apple was there. Samsung, Huawei, LG, HTC and Microsoft attended, along with less familiar brands. They demonstrated virtual reality systems based on Android phones. And Facebook’s Mark Zuckerberg demonstrated similar technology in the conference hall.

Virtual reality was, they told us, "The next big thing."

Except it wasn’t. It didn't happen. Not this time. You can still buy VR hardware, but it is rare.

As the Americans say, it’s "a freak show". We've been here before. Technology media first

got excited about VR in the mid-1990s, then again a decade later. Expect another cycle around 2025.

The first time around, VR graphics were blocky. Movement was jerky. The headsets and VR gloves needed to make it work were clunky. They were heavy enough to challenge anyone who wasn’t an Olympic weightlifter.

Demonstrations lasted seconds. Hardware and networks were not up to delivering data fast enough to make VR worthwhile. There were few apps, games or otherwise.

We did get a lot hype though. And near useless kit that, by now, will be landfill.

Mind you, at times that hype was impressive.

There was talk of a new media revolution. Grubby types even suggested we could soon indulge in realistic cybersex.

One less frivolous computer company did talk about business apps. It suggested analysts might stand in a virtual field of wheat blowing in the wind. There, they would somehow spot what was wrong with their company’s business strategy.

That company was Silicon Graphics. At the time it was hot. It championed serious VR. Today it is a forgotten brand.

You didn't have to look far at Barcelona to understand why VR flopped. Almost every phone maker showed the same VR demonstration: a roller-coaster ride. There was almost no other content.

That's the problem, right there. It costs a fortune to create VR content. A blockbuster Hollywood movie might have a budget of a few hundred million dollars. VR is more complicated. Cameras need to shoot scenes from more angles. VR needs more equipment and personnel, and more backroom processing.

That means a huge investment. Given a restricted audience, there is less potential return. To earn a profit, prices need to be sky high.

The technology is there. Hardware and networks are fast enough to deliver VR, but there’s no business model for content. At least not yet. Wake me up when there is one.

VIRTUAL INSANITYby Bill Bennett

Bill Bennett is a journalist and broadcaster. He has spent most of the last 30 years writing about technology and business. He edits The Download

FOR THEGENIUS IN ALL OF US

chorus.co.nz

CHO0171 DownloadMag 275x210_v3.indd 1 1/3/19 1:34 pm