Despite years of hype about the move to ultra-fast fibre broadband, for the next two to three years all the money for telcos is going to be in copper.
That’s the opinion of TelstraClear CEO Allan Freeth, who earlier today addressed an audience of industry professionals at the Tel.Con12 telecommunications summit in Auckland.
"It’s going to be a copper world for the next two to three years,” Freeth says.
"It’s cool to be trendy and sexy with fibre, but the smart guys know there’s still money in copper.”
One of the hindrances is that costs like installing internal wiring and the ’15 metres to the door’ are yet to be allocated.
With access to online content still marginal, consumers aren’t going to want to foot the bill themselves, Freeth says.
"Until the content thing is sorted uptake will be slow. Why should [consumers] have their lawn or asphalt dug up?”
When a member of the audience raised new content entrant Quickflix, Vodafone CEO Russell Stanners, who was sharing the stage with Freeth, responded that ‘saying Quickflix competes with Sky is like saying the corner dairy competes with Countdown’.
"Would you give up your Sky Sports?” Stanners asked.
Extrapolating on the issue, Freeth explained that our small population continues to be a barrier preventing large providers like Netflix from getting into the market.
While Stanners says he doesn’t see Vodafone becoming a content provider, Freeth says once fibre is in place content is going to be the only way for telcos to compete.
"If we start competing on price, we’re on the long way to the bottom,” Freeth says.
Also on the stage was Eric Hertz, CEO of 2degrees, who advised the audience not to neglect the importance of mobile, citing the purchase of Instagram by Facebook for US$1 billion, despite the company having no revenue stream, nor any plans to create one in the future.
Hertz added that 2degrees now has over 900,000 customers, and expects to hit 1 million in the next few months.