Iwi secure China Telecom funding for Auckland-Whangarei cable – nbr

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It’s a few months late, but Taitokerau Networks(a limited partnership between six iwi and Wellington company Datalight) has made good on its promise to build a new broadband connection between Auckland and Whangarei writes Chris Keall.

State-owned China Telecom is bankrolling the project,and supplying materials logistical support for FX Networks and Datalight, who are designing, building and sellng the new network.

Construction is now underway on the $8.5 million, 200km Auckland-Whangarei fibre optic cable, due to be completed in five months.

Over the next two years, further cable will be laid connecting theBay of Islands, Kaeo, Kaitaia, Hokianga, Dargaville, Awanui and Waitiki Landing, and an eastern route returning from Whangarei to Auckland to form a total network running more than 700km.Te Rarawa chairmanHaami Piripi told NBR this morning. The $8.5 million budget announced so far covers only the 200km Auckland to Northland leg.

Four kilometres of cable have already been laid in the Wellsford (north or Auckland) to Maungaturoto.

The project breakdown
China Telecom subsidiary Axin is suppling the finance and materials.

FX Neworks is handling design, construction and dark fibre (wholesale bandwidth) sales, linking to the operator’s existing national contracts.

Datalight is project managing, and desigining and constructing layer two (retail or lit fibre) services.

The network will be a not-for-profit venture, and interconnect to rural schools, health providers, farms, businesses, marae and households with the government-backed Ultrafast Broadband and Rural Broandband Initiative fibre roll-outs.

Snubbed
As first-reported by NBR (below), in February,Taitokerau Networks announced it had financial backing fromNew Zealand’s Datalight, with Counties Power and Axin (a China Telecom subsidiary recently seen teaming with Huawei Marine to move in on Pacific Fibre’s turf) on board for the logistical side of the build.

Mr Piripi told NBR “the irony is not lost on us” that a Chinese government-owned company was financing the deal after Finance and Infrastructure Minister Bill English turned down Taitokerau Networks’ request for funding.

Debt-funded
A debt-equity arrangement meant Axin was the main funder of the build, but would not have any long term ownership stake, Mr Piripi said.

Taitokerau Networksexpects returns to Iwi start exceeding investment within two years.

High-speed, no datacaps
No indicative pricing has been released (other than to say customers can expect “significantly reduced broadband costs”. But on paper at least, the iwi network is looking sharp.

In its promotional material, Taitokerau Networks is promising speeds between 100Mbit/s and 1Gibit/s (1000Mbit/s), “simple monthly rental, nil data caps, no corenetwork complexities or risks, point-to-point fibre configurations, minimal operationalrisk (99.995% availability), private networking capacity, high fibre count to cater for ruralconnections.”

In and out
In Feburary, NBR reported that Counties Power would partner with Axin on the build.

The utility has now dropped out of the picture.

But FX Networks is now onboard, along with original equity partner Datalight (Datalight is co-owned byRoger De Salis- erstwhile son-in-law ofColin Hill, the Isle of Man tax-exile owner of FX Networks).

Tight crew
It’s a familiar alliance. Taitokerau Networks, Opto Network (yet another De Salis vehicle) and FX Networks teamed on theTorotoro Waea bid for the government’s $300 million Rural Broadband initiative.

Torotoro Waea was one of three on the shortlist for the tender, ultimately won by a joint bid from Telecom and Vodafone (although back-room politics saw the government establish a new advisory board,Nga Pu Waea, to liaise with Telecom and Vodafone over iwi employment and development opportunities on their rural roll-out. The move helped Nationalshore-up Maori Party support for the separate, $1.35 billion ultrafast broadband initiative after several Act MPs reversed their earlier support for the enabling legislation, the Telecommunications Amendment Act).

A tangled web of alliances saw FX Networks also support the third short-listed bidder, OpenGate - a consortium that consisted of FX, Woosh Wireless and state-owned Kordia – which has told media over the past couple of days it is now in talks with Axin over a range of possible projects.

While still smarting tht the Torotoro Waea rural broadband bid was snubbed by the MED and Communications Minister Steven Joyce, Mr Piripi was full of praise for China Telecom’s Axin.

“Their technical knowledge and expertise and understanding been absolutely fantastic,”the Te Rarawa chairman told NBR this morning.

“We’ve been absolutely amazed by the integrity and the helpfulness of ourChinese partners.”

http://www.nbr.co.nz/article/snubbed-government-iwi-secure-china-telecom-funding-auckland-whangarei-cable-ck-85258

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