Vocus Group and Vodafone announce joint venture to accelerate fibre innovation

5 June 2018

Vocus Group and Vodafone have today announced a joint venture to unbundle New Zealand’s government-backed Ultra-Fast Broadband (UFB) fibre network.

Unbundling will allow Vocus, Vodafone and other RSPs to start providing telecommunications services over the UFB network, reducing their dependence on Chorus and other local fibre companies (LFCs).

Vocus and Vodafone say unbundling will accelerate broadband innovation and wholesale price competition by allowing greater investment in the technology that powers the tens of thousands of kilometres of fibre optic cables spread throughout New Zealand.

Allowing third parties access to the UFB network is the next step in the evolution of UFB, and will see New Zealand broadband speeds and quality skyrocket.

The recent select committee recommendation to confirm unbundling by 2020 means Vodafone and Vocus can finally proceed with their plans to launch new innovative fibre services for consumers and businesses from January 2020.     

The joint venture will involve scoping, designing and investing in unbundling the fibre local loops of the four local fibre companies (LFCs), with a view to providing wholesale fibre products to the retail market in competition with LFCs.

The companies have today issued an RFP to local fibre companies for ‘Layer One’ wholesale services and pricing.

Vodafone Chief Executive Russell Stanners said, “We are excited to work with Vocus on this project as it will result in faster innovation, more choice and competitive wholesale pricing for Kiwis. We don’t see any reason to delay now that the Government has given the green light for unbundling to get underway from 2020.

“After six years the four LFCs have delivered a small number of retail fibre products to consumers, compare that to unbundled markets like Singapore where retailers are able to fully customise their products to meet the needs of different consumers. This level of innovation and competition is what we want to see in New Zealand.”

Examples of these future fibre products could include retail plans with speeds up to 10Gbps (which is already happening in Singapore and Switzerland), low latency options for gamers, more ‘business class’ products for customers wanting premium service options, and more reliable throughput speeds generally.  

Vocus New Zealand Chief Executive Mark Callander said, “We have already seen the huge benefits of copper unbundling in New Zealand and it’s time now to turn our focus to fibre as markets overseas are already doing.

“Our brands Slingshot and Orcon invested heavily in copper unbundling, as did Vodafone, and it dramatically changed the broadband market in New Zealand. It bought real competition, innovation and price savings to Kiwi consumers. Unbundling fibre is exciting, and will bring about tangible change.

“Partnering with Vodafone is a natural fit for Vocus, bringing to the table their global fibre experience and capabilities to complement our leadership in unbundling fixed networks here and in Australia. The combined scale and market share we both bring will be a key enabler of the initiative.

Vocus Group and Vodafone announce joint venture to accelerate fibre innovation