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Broadband roll out for NZ – will it effect real estate?

Posted on: March 31st, 2009 | Filed in Technology

istock_000000295237xsmallThe government today unveiled plans for the committed $1.5bn investment in bringing fibre delivered broadband to NZ’ers. There are two key elements of the plan that are critical for the future of the NZ economy – one certain, the other not so certain.

The first element is the decision to invest in fibre to deliver access speeds of 100 Mbs – this is to be achieved by a Crown owned investment company working in partnership with private sector investors to lay “dark fibre” to bring this broadband to 75% of the population through 25 towns and cities. The decision to commit to the laying of dark fibre is exactly what is needed as explained in this prior blog post entitled “True broadband for NZ – our future will be dictated by who owns the dark fibre“.

The second element is going to be socially and economically contentious. The announcement speaks to 25 towns and cities being the recipients of the investment support of the new Crown owned investment company. These towns and cities are going to be gaining an advantage in access to true high speed broadband that those people living outside of these towns and cities will not have.

This differentiation will impact real estate, for whilst we may not fully appreciate the impact today; in the coming years we will see more and more of our lives focused around the online world – for education, for learning, for entertainment, for services, for monitoring, for communications and so much more – all we know for sure is that we don’t yet know quite how important / critical it is going to be.

We certainly face a dilemma in NZ of scale – we live in a huge country with a tiny population, this leads us either down a path of the lowest common denominator for services or we have to choose to be selective and seek to help the majority¬† for the long term good of all NZ’ers.

It is likely that property on the wrong side of the cut-off of scale (population of less than 12,681 which is Oamaru) will suffer a decline or a lesser growth in demand in time as the lack of fibre access for communications makes people question the value of being outside of the fibre network. That will be a factor which the inhabitants of these smaller towns will have to grapple with and make hard decisions, in many ways decisions they make everyday as the weigh up the pros and cons of rural NZ life.

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