NZ Telecom announces forced migration to VoIP network

[David Farber <dave () farber net>]

Begin forwarded message:

From: Gavin Treadgold <gav () rediguana co nz>
Date: August 30, 2005 6:25:14 PM EDT
To: Farber David <dave () farber net>
Subject: NZ Telecom announces forced migration to VoIP network


Dave, for IP if you wish.

Telecom New Zealand has recently announced that they will be  
upgrading the PSTN between 2007-2012 to a private VoIP network. No  
mention yet as to interfacing between Telecom's private VoIP network  
and other IP networks. I assume that it will occur over DSL as that  
is the only broadband we have capable of reaching a large percentage  
of the population.

Cheers Gavin

---

Upgrade for every Telecom phone
<http://www.stuff.co.nz/stuff/print/0,1478,3394689a11,00.html>
31 August 2005
By ADRIAN BATHGATE

Every home with a Telecom phone will need a new phone or adaptor in  
the next seven years because of an upgrade, but Telecom says it does  
not know the cost or who will pay.

Between 2007 and 2012, Telecom will shift 1.7 million phones from the  
1980s switched-circuit system to an Internet protocol-based network.

With IP, voice is broken down and transmitted as data, and  
reassembled at the other end. Added software makes "smart" phone  
services available.

Telecom's chief operating officer, Simon Moutter, said those included  
the ability for a customer to have a number to allocate to any phone,  
at any time. More advanced features include video-on-demand and  
online gaming.

"All of today's products and services won't necessarily be available  
in the same structure, so it's a very large challenge," Mr Moutter  
said. Telecom was making sure basic phone functions were in place first.

The project, which has been planned for a few years, will cost $1.4  
billion. Telecom will replace equipment between exchanges and  
roadside cabinets, but copper lines into homes will remain.

The first phone lines will be put on to the new network in 2007.

Telecom's customers will need an IP-capable phone or an adaptor that  
can convert calls. Telecom said no decisions had been made about how  
much this would cost, or whether it would be subsidised. Existing  
phones should be usable till 2012.

---

Triple-play on Telecom's speed dial
<http://www.nzherald.co.nz/section/print.cfm?c_id=3&objectid=10343238>
31.08.05
By Peter Nowak

Telecom is poised for big cost savings and possible job cuts by  
replacing its phone system with a next-generation "triple-play" network.

The company acknowledged yesterday the new network would take some of  
the cost out of doing business and that staffing would be affected in  
a process that would "take some years".

Chief operating officer Simon Moutter said: "This new network will  
transform the nature of the business. You can envisage on the end of  
this a profoundly different business model."

Moutter guessed at possible cost savings of $100 million a year,  
although spokesman John Goulter later said Telecom had no definitive  
estimates. Goulter also said there were no immediate plans to cut staff.

Analysts said the new network, a "triple-play" of voice, data and  
video services, will introduce several consolidation benefits. It  
will cull several points of product entry for customers to one,  
reducing costs in everything from marketing, billing and rental of  
physical floor space.

By one estimate, Telecom's operating costs would be shaved by 60 per  
cent to 80 per cent.

That would be good news for the company, which saw its annual  
operating expenses rise to $3.3 billion for the year to June 30, from  
$3 billion a year earlier.

Sydney-based telecommunications analyst Paul Budde said the network  
would also make a significant number of jobs redundant.

"There's no doubt about that. The good news is that New Zealand has  
already moved further than lots of other countries, so the pain won't  
be [as bad]," he said.

Budde estimates the network would eventually allow Telecom to cut  
between 10 to 15 per cent of its workforce, "not overnight, but  
gradually".

The new infrastructure will replace the old digital phone network -  
installed in the 1980s - with an internet protocol network. In  
essence, customers will be making all calls over the internet, albeit  
a privately secured one owned by Telecom.

The company has begun a three-month voice call trial with 120  
customers and expects to start migrating customers on to the network  
in early 2007.

The complete transition of 2.2 million customer lines is scheduled to  
be complete by 2012.

Moutter said while existing voice-over-internet-protocol services -  
such as the wildly successful Skype - offered extremely low-cost  
calls, that would not necessarily be the case with Telecom's offerings.

He said the quality of internet calls was still questionable while  
Telecom's offerings - which he pointedly stressed were "not internet  
voice" - would continue to be of a high pedigree.

There would be a range of offerings, with high-quality calling  
costing more and lower-quality costing less.

Aside from voice and traditional broadband internet services, the  
$1.4 billion Alcatel-supplied network will also introduce video  
capabilities.

In the near term, analysts expect this to translate into video calling.

But down the road it could also mean television-like services.




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