The state of broadband in NZ

According to a survey by Ookla.com, New Zealand ranks 42nd in terms of broadband speed.

According to a survey by Ookla.com, New Zealand ranks 42nd in terms of broadband speed.

Just over 81 per cent of New Zealand households are connected to broadband, with many seeing it as being almost as important as running water.

So what is the current state of play with broadband in New Zealand?

HOW FAST (OR SLOW) IS OUR BROADBAND?

If there's a universal constant with broadband it is this: No matter how fast our broadband is, we complain about it. 

This begs that an important question gets asked – how slow (or fast) is broadband in New Zealand?

According to a survey by Ookla.com, New Zealand ranks 42nd in terms of broadband speed.

Our average download speed is 27.4Mbps, which isn't too bad, especially when you consider the Australians ranked 65th.

Their average speed is just 16.66Mbps. Ookla put New Zealand broadband just above the global average (23.3Mbps).

THE BIG TRENDS

So what's driving broadband in New Zealand? According to IT market researchers IDC, there are 6 key broadband trends:

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Unlimited data

Until recently, most people had data allowances. Once used up, consumers got hit with fees or had data speeds throttled. 

The introduction of unlimited broadband allowances took the anxiety out of the broadband equation.

According to Peter Wise, the country manager of IDC New Zealand, this is reflected in unlimited broadband uptake: "According to New Zealand stats in June 2013, 5 per cent of broadband connections were unlimited; by June 2015 this reached 33 per cent. IDC estimate this figure is around 50 per cent today."

A need for speed

IDC also says services such as Netflix and Spotify are driving a need for speed. IDC claims 46 per cent of residential fibre connections are 100Mbps or faster.

Going naked

Many Kiwis are also ditching landlines with IDC saying that about half of new consumer fixed broadband connections are internet only.

Wireless broadband

Wireless broadband is also taking fast internet where wired broadband won't reach. It isn't perfect, but it's still an improvement. 

"These products although still under data caps (so not suited to the entire market) provide the internet at a fast speed and cost effective manner, to a wide number of people," said Wise.

Bundling

According to IDC, a growing number of ISPs are using bundles to sell broadband: "We have seen clear success in providers who are able to bundle in additional services with their broadband package," said Wise.

Many screens

How we go online has also changed. The days sitting at a desktop PC are gone. Many people go online with several devices, switching between them depending on what we're doing.

Fibre is driving churn

Perhaps the most significant broadband trend until now with broadband was low churn. Churn is when broadband subscribers move to another ISP. According to IDC, broadband churn has been low owing to the "set and forget" nature of broadband plus many subscribers are locked into contracts. This is changing thanks to fibre:

"The rollout of fibre has brought about a natural reconsideration point for consumers," said Wise.

"Essentially, consumers who have had DSL for a long period of time and never considered switching provider are now getting knocks on their door telling them about UFB. They can often be persuaded to change to fibre as it is a better product at the same or lower price and so they then shop around".

WHAT TO LOOK FOR

So what should subscribers look for if shopping around for a new broadband plan?

According to Denis Tyurkov, founder of ISP comparison service, Glimp, consumers are shopping around for a broadband plan based on price, speed, data allowance, contract length and landline options.

Tyurkov says that when looking at broadband plans, it is important to take many variables into account as well as price.

These include knowing what sort of broadband user you are (eg a light, medium or heavy user), as well as how many broadband users are in your household. The answers to both these questions can determine whether you should go for an unlimited or capped plan and what sort of broadband speed is best for you.

Another factor according to Tyurkov is the availability of broadband technologies at your location.

Entering your home address into the glimp.co.nz will tell you what types of broadband are available at your location. Answering several simple questions on the site helps Glimp determine which broadband plans and ISP are best suited to you.

Contractual flexibility is also important. This is about how prepared you are to sign up to a contract.

A contract may mean cheaper plans, but will lock you into a 12 or 24-month term. For those needing less than 12 months of broadband, a no contract plan is their best bet.

For those planning on staying at the same address for more than 12 months, then a contracted option with additional benefits (such as a more competitive price, bundled power, or other services etc.) may be a better choice.

Another feature is naked broadband versus bundled landlines. If you tend to use mobile phones for calling, or are a heavy online messaging and Skype user, odds are that you don't need a landline.

THE FUTURE OF BROADBAND IN NZ

There's no end of speculation around broadband. This said, there are fundamentals that pundits tend to agree on.

IDC expects the migration to fibre to continue as consumers seek faster speeds with demand driven by data-hungry services such as video streaming.

It also sees the internet of things and smart homes figuring in future broadband demand.

Wise says "the connected home is becoming a reality".

"Today there are already clear and simple broadband-based products in the market that can make our lives easier. 

"The internet of things will really accelerate over the next decade in both mobile and fixed internet applications."

 - Stuff

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