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Study Quantifies Demand for High-Speed Broadband

Media Release: Auckland Regional Broadband Advisory
4 August 2008

New Study Quantifies Demand for High-Speed Broadband

Auckland households would be willing to pay approximately $95 per month for a high-speed broadband service, equivalent to a fibre-to-the home service according to a study released today. When combined with business demand for a similar level of services this equates to total revenue of $45m per month. The analysis was commissioned by the Auckland Regional Broadband Advisory (ARBA), a group of local government officials that has been formed to provide an integrated regional view on the development of broadband in Auckland.

The project investigated demand for broadband services that will require network capability beyond the ADSL2+ services becoming available using the next generation of Telecom’s network. It concluded that the potential revenue could be enough to fund for a fibre-optic network if a combination of public and private investment was used to finance the project.

The ARBA study also showed that many businesses and households already know how they would use the extra bandwidth, and revealed frustration by end-users over the quality of existing services. Ross Peat, Vice Chair of ARBA said that telecommuting and remote learning were found to be key potential uses of high-speed broadband for households, while businesses anticipated greater efficiencies, better customer service, more remote working, enhanced local and international collaboration, and more innovation.

The project was undertaken by a consortium led by economic consultants Covec, with funding support from the Ministry of Economic Development. The research team focused mainly on aggregate demand for broadband and used simple and conservatively high estimates of cost. Project economics would be improved by targeting high-value areas in the first instance, but doing so would not address the digital divide issues that were also revealed by the research, which found stronger demand from wealthier and better educated households.


A copy of the report ‘Open Access Broadband in Auckland: Demand, Costs and Benefits’ is attached.


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