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Govt must be wary of increasing digital divide with 5G deployment - Chorus

01 May 2018

Chorus has encouraged the Government to keep its objective of eliminating the digital divide at the forefront when formulating policy about 5G, so significant sectors of the economy do not miss out.

The company has responded to a request from MBIE for industry respondents to provide their perspectives on the challenges and opportunities of a 5G rollout.

“The Government has clearly set a major policy goal of reducing the digital divide to ensure all Kiwis are able to partake in a digitally-enabled future,” says Chorus CEO Kate McKenzie. 

“We know the availability of 5G mobile services are likely to form an essential part of the future digital landscape, but the specific use cases and business cases are still unclear, with challenging overall economics.

“Because the economics of 5G will be challenging, we believe a business as usual deployment by three operators is unlikely to achieve economically sustainable broad deployment.

“Commercial operators will, quite rightly, seek to generate a commercial return from their investments, meaning 5G rollouts are likely to be incremental, focused on cities and with potentially higher costs to consumers.

“But that may see significant segments of the economy, such as rural or the less able to pay, miss out while cities and the well-off get the benefit, and this will harm New Zealand’s overall competitiveness.

Chorus has proposed a range of solutions to support the development of a 5G policy that will most effectively address the digital divide.

“First, we welcome the Government seeking feedback on infrastructure sharing and hope this facilitates a sensible industry discussion about its merits.

“However, there are more than two choices when it comes to sharing. Options range from simple commercial site sharing agreements to only rolling out physical infrastructure once and using network slicing software technology to ensure vibrant competition, through to a fully regulated open access network, and a full spectrum of options in between,” McKenzie says.

She adds that already today, Chorus assets are used by each of the mobile operators to provide their mobile services, and not all future sharing arrangements would require regulatory intervention. 

A sensible exploration of all the options is warranted to effectively address the digital divide.

“Second, while use cases and business cases continue to evolve, we suggest that at least some spectrum is held back from any initial auction to support future innovation.

“Finally, we need to ensure the findings of the Commerce Commission’s mobile market study are factored into any policy decisions to ensure any competition issues are not inadvertently deepened.

“New Zealand deserves a sensible investigation of these recommendations to ensure the digital divide is not deepened and the country as a whole gains maximum benefit from emerging technologies,” she says.

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