Vocus-Vodafone joint venture to unbundle UFB services

Vocus Group and Vodafone NZ have formed a joint venture to offer unbundled wholesale services on the Ultra-Fast Broadband (UFB) fibre network, in competition with Chorus and other local fibre companies (LFCs).

Unbundling means retail ISPs and others will be able gain direct access to the UFB fibre, install their own network technology and manage their service to the customer.

Without unbundling, broadband package details are determined by Chorus or other local fibre companies.

Vodafone and Vocus say 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.

The new joint venture will scope, design and invest in providing wholesale fibre products to the retail market on the unbundled fibre local loops of the four local fibre companies, in competition with them.

They say that allowing third parties access to the UFB network will accelerate broadband innovation and wholesale price competition and increase broadband speeds and service quality.

The two say they have already issued an RFP to local fibre companies for ‘Layer One’ wholesale services and pricing.

InternetNZ has welcomed the move and CEO Jordan Carter has called for access negotiations to proceed expeditiously.

"We hope that all parties are able to prioritise meeting and discussing mutually acceptable terms for fibre unbundling. That would be good for New Zealand, by doing more to unlock the potential of the UFB investments made over the past decade," he said.

Their move follows recommendations from select committee recommendation to confirm that unbundling should be permitted from 2020.

Vodafone CEO Russell Stanners said: “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.”

Vocus New Zealand CEO Mark Callander said: “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.”