Telecom New Zealand (ASX: TEL) has been given the all clear to begin exploring the commercial viability of VDSL in New Zealand following a favourable Commerce Commission ruling on the use of the technology by the company in the provision of its wholesale broadband services.
VDSL, or Very high bitrate Digitial Subscriber Line, offers downstream speeds of up to 52Mbps, compared to up to 24Mbps for ADSL2+ and up to 8Mbps for ADSL.
The ruling states that the telco has the freedom to offer its regulated price wholesale broadband service to downstream ISPs either over ADSL, ADSL2+ or VDSL.
The telco would also be able to introduce a separate VDSL service, differentiated through features such as offering a minimum access speed, at commercial, rather than regulated, rates.
According to Telecom spokeperson Ian Donnar, while still in early devlopment, VDSL has the potential to be a stop-gap technology over the next decade while the Ultra Fast Broadband network is rolled out throughout New Zealand.
“We don’t see [VDSL] as competitive to fibre, we see it as an incremental step towards fibre,” he said. “It is something we can be doing now and the plan for fibre here is a ten-year one so there will have to be something done in between now and then.
“We want to be a part of the Government’s fibre vision, but that doesn’t mean we’re going to stand still today.”
With Telecom wholesale still needing to develop a VDSL product, decide on pricing, and convince ISPs to offer the service, it would be some time before commerical VDSL services were seen in the market, Donnar said.
“Having the ruling that says we can treat VDSL as a commercial products means we can get on with delivering it,” he said.
Donnar added it was too early to determine an average price for a residential VDSL service.
Yesterday, Telecom said it had revised its financial guidance for the financial year 2011 through 2013 to reflect the impact of several regulatory and market factors.