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Subject: [IP] more on NZ Telecom announces forced migration to VoIP network

  • From: David Farber <>
  • To: Ip Ip <>
  • Date: Tue, 30 Aug 2005 21:08:36 -0400

Begin forwarded message:

From: Bob Frankston <>
Date: August 30, 2005 8:53:34 PM EDT
To:, 'Ip Ip' <>
Cc: 'Gavin Treadgold' <>
Subject: RE: [IP] NZ Telecom announces forced migration to VoIP network

I want to know more about this. I presume most Telcos are moving to
IP-based infrastructure but are trying to maintain the illusion it is still
the PSTN. An attempt to maintain a private IP infrastructure would seem to
be in the same mold but they are making the transition visible. Perhaps
they are simply going to give up on telephony as a revenue source and are
going to help their users go to naked VoIP while they become a connectivity

Will they try to maintain their advantaged position? Perhaps they expect
little competition in their marketplace so won't have to play the games I
complain about in Or maybe they
simply in denial.

Can you find out more about their plans?

-----Original Message----- From: David Farber [] Sent: Tuesday, August 30, 2005 20:14 To: Ip Ip Subject: [IP] NZ Telecom announces forced migration to VoIP network

Begin forwarded message:

From: Gavin Treadgold <>
Date: August 30, 2005 6:25:14 PM EDT
To: Farber David <>
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
31 August 2005

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 &quot;smart&quot; 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.

&quot;All of today's products and services won't necessarily be available
in the same structure, so it's a very large challenge,&quot; 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
By Peter Nowak

Telecom is poised for big cost savings and possible job cuts by
replacing its phone system with a next-generation &quot;triple-play&quot; 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 &quot;take some years&quot;.

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

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 &quot;triple-play&quot; 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.

&quot;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],&quot; he said.

Budde estimates the network would eventually allow Telecom to cut
between 10 to 15 per cent of its workforce, &quot;not overnight, but

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 &quot;not internet
voice&quot; - 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

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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