On 1/31/2012 2:54 PM, Matthew Moyle-Croft wrote:
The market though isn't just the inward looking market (ie. within telcos in NZ). The actual market is much broader and important.
NZ is a small market. For an entrant to come into the market from outside they need to be able to access a very high percentage of your broadband services *at a reasonable cost in country* to be able to make the numbers work.
Those are entirely valid points, and not something I had considered til you raised it.
If there's a significant barrier to in-country peering then they will stay out of the country. It's like protectionism. It raises the cost of connectivity for everyone across the board.
So, this means people like Amazon, Google, Limelight, Microsoft etc (ie. the big content players) won't ever setup inside you country. (Think how important they are these days in terms of bandwidth).
Valid points, although indicators have been that those operators are less likely to build directly into New Zealand anyway. As you point out, NZ is a small market and [un]fortunately it is very close to Australia. Building an Australian east coast POP that also serves New Zealand, and -often picks up all the New Zealand routes via peering- in that location is very typical for those operators. They then save on the costs of deploying POPs in New Zealand (power, colo, travel, support, etc), and mostly don't suffer any negative performance consequences to the end user, assuming NZ ISPs aren't congesting their international connectivity, or are able to cost-effectively peer on the Australian east coast.
ie. the market is broader than between domestic ISPs.
I'd argue therefore the report has gotten it wrong as it's not understood what the market is nor why that's important.
Agreed. And that's really good feedback for the report -- I hope the authors are reading and consider that content attraction aspect. I do recall it being discussed inside InternetNZ last year, and some of the points raised by you (and the ones I mention above) were the ones given by those content players.