Rural 4G clears final hurdle
The Government has finally completed the sale of the "digital dividend" radio spectrum band, meaning mobile broadband networks can now be upgraded to 4G technology.
Communications Minister Amy Adams said Telecom and Vodafone had paid an extra $11.1 million to get the particular blocks within the 700MHz band that they wanted, taking the total proceeds of the spectrum sale to $270m.
Telecom bid $9.1m in the frequency-allocation phase, taking its total outlay to $158.1m.
Network capability manager Tonie de Vries said the spectrum would let Telecom increase the total carrying capacity of each of its rural cellsites by about seven times to about 450 megabits a second.
That would allow it to offer more customers faster speeds and higher data caps, in some combination.
General manager of networks Colin Brown said Telecom would also use the low-frequency spectrum to provide better in-building 4G broadband coverage in cities and towns.
The 700MHz spectrum was freed up by the closure of analogue television broadcasting last November.
Today's announcement means specific frequencies have now been allocated to the telcos, allowing them to begin network construction.
The allocation process was held up for a few months while the Commerce Commission debated whether to allow Telecom to acquire a fourth spectrum block, before it gave the green light this month.
Vodafone agreed to buy three blocks and 2degrees two blocks.
However, the Government mandated that Vodafone's and 2degrees' spectrum should sit in adjacent bands so the companies would potentially be able to share their resource.
The three telcos had entered into commitments that would mean 90 per cent of New Zealanders would get access to 4G services within five years, Adams said.
Seventy-five towers will be built to increase mobile coverage.
The Ministry of Business, Innovation and Employment has estimated the economic benefits of switching the 700MHz from analogue broadcasting to 4G at up to $2.4 billion over 10 years.
Telecom has been running a trial of 700MHz 4G in Waikato in conjunction with Chinese technology provider Huawei.