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Rural people using the internet to save on fuel

21 May 2008

Rural people using the internet to save on fuel prices

Rural people are increasingly turning to the internet in response to rising fuel costs, according to rural broadband provider Farmside.

During April, as fuel prices rose weekly1, the Farmside Contact Centre experienced a 97% increase in rural broadband enquiries with a similar pattern emerging through May, says Farmside sales and marketing director, Nick Carter.

"Many of our new customers are citing rising fuel costs as one of the main reasons for getting satellite or wireless broadband", he says.

"They realise they can save money by using the internet for errands that have traditionally required a personal trip, like banking, shopping, vehicle registration, study or even doing tax returns.

"The average driver in rural New Zealand spends 300 hours driving nearly 15,000 km each year, with 30 percent of this travel for reasons such as shopping or to carry out personal business2.

"With the increase in online services offered by the retail, business and government sectors, rural people are becoming more aware of how using the internet can save on travel costs.

"If you use the AA estimation3 of 11.90 litres of petrol used per 100km for a V6 or V8 vehicle similar to that driven by many rural people, a 20 percent annual reduction in travel (3000 kms) through increased internet use for things such as business, shopping and online banking, based on today's petrol prices (95/96) of around $2.019 per litre4, would equate to an annual saving on petrol alone of $720.78

"Add an average running cost3 of $213.00 for oil, tyres and repairs and maintenance over the 3000 kms saved, and your total saving comes to $933.78 on just a 20% travel reduction.

"That figure excludes other factors like the fixed costs of vehicle depreciation, the cost of a person's time and reduced productivity while sitting behind the wheel.

"Compare these costs to the many benefits of the internet, such as such as access to online specials for a huge range of products and services, up to the minute information providing the competitive edge and the increasing number of internet-based farming and business management tools.

"When you start to do the numbers, rural broadband connectivity through Farmside clearly represents significant potential savings," says Mr Carter.

Farmside customer and chartered accountant Jennifer Gillies says her Farmside satellite broadband connection has meant ongoing savings for her home-based business.

"Having Farmside broadband means I can have instant communication with clients without having to leave the house for a meeting or to deliver paperwork, which greatly minimises fuel costs and the amount of time I spend travelling," she says.

"It's a win-win for both me and the client. My turnaround on their work has increased, travel costs are not chargeable and in turn, my weekly billable hours have increased."

Land Transport NZ spokesperson Andrew Knackstedt says cutting back on vehicle use through increased internet use is one of the easiest ways to save on fuel costs.

"In addition to reduced fuel bills, there are many indirect savings to be made when you use the internet rather than make a trip into town, such as reduced vehicle depreciation and the safety benefit of avoiding driver fatigue," he says.

"We saw a 36% increase in online transactions for the September 07 to March 08 period, including motor vehicle licensing and re-licensing, Road User Charges purchases, and driver licence test bookings.

"Roughly 6% of motor vehicle licences are now purchased online, about 16% of change of ownership transactions are completed online and nearly 30% of change of address notifications.

"Nationwide broadband access for rural areas is obviously having an impact by enabling rural people to save on travel costs through greater use of the internet."


1 AA PetrolWatch Report, April 2008

2 Ministry of Transport Ongoing Household Travel Survey, 2003-06.

3 AA Petrol and Diesel Car Costs Reports, 2008

4 Daily New Zealand petrol prices,

About Farmside

New Zealand's leading rural broadband provider, Farmside provides rural Kiwis nationwide with access to the telecommunications services they need to improve productivity, save time and enjoy a better lifestyle. While many rural homes are limited by exchange capability or line issues, satellite broadband covers virtually the whole of New Zealand. Farmside delivers satellite broadband services throughout New Zealand via the IPSTAR satellite, the biggest and most advanced communications satellite in space, launched in 2005. Utilising primarily the IPSTAR two-way satellite system, the Farmside broadband network spans New Zealand, offering broadband access to all rural and provincial dwellers, regardless of distance from an urban centre, isolated location or challenging topography. For customers living within a coverage area for wireless internet, Farmside also provides the Kordia Extend Lite wireless broadband product. Other Farmside services include mobile solutions and associated computer and networking equipment to enable integrated connectivity.


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