Telecom is to make its high speed internet service JetStream available in eight provincial Otago towns which wouldn’t normally meet the company’s commercial criteria.
Oamaru, Wanaka, Alexandra, Cromwell, Kurow, Balclutha, Palmerston and Milton will all get JetStream access by December 1 under a deal between Telecom and the Community Trust of Otago, which will underwrite the installation and thus reduce Telecom’s financial risk.
Roxburgh, Owaka, Ranfurly and Lawrence may also get the service, provided Telecom can overcome possible technical problems with the exchanges in those towns, trust chairman Clive Matthewson says.
“If the sign-up level reaches 30 at each centre, then the trust won’t have to pay anything, but if the level is less than that, then we will have to pay up to a maximum of $236,000 across all the centres.”
He believes the demand is there to make the arrangement work and points to the results of the study by the Otago-Southland broadband communications committee, which indicate there is plenty of interest in higher bandwidth in the region.
If the rollout to the initial eight (or possibly 12) centres is successful, it may be extended to exchanges in other, smaller Otago towns, Matthewson says.
The trust held talks with Telecom and BCL about providing the service and the response from both was “very positive”, Matthewson says.
Asked why Telecom was chosen, he said “of the two proposals, Telecom’s was the better one,” and wouldn’t elaborate.
BCL managing director Geoff Lawson says he is philosophical about BCL missing out on the deal.
"It's business - you win some, you lose some."
Telecom operations chief Kevin Stratful says the trust's underwriting "has allowed us to be involved in a scheme which could be a blueprint for extending broadband to other rural centres.
"The aggregation of demand provides an opportunity to extend our provision to areas where it is not presently commercially viable."
The deal is officially launched in Dunedin today.