'Blazing' broadband is blast from past

Telecom is marketing its new broadband plans to come on line next week as "blazing" and "super fast" but the company offered the same speeds to customers in 1999.

Telecom says its "blazing speeds" will be "powering their way into Xtra's new Go Large" plans from October 23.

These super-fast speeds are known as unconstrained in the telecommunications world - the maximum speeds possible for Telecom's broadband ADSL technology.

But Telecom has had the capability to offer super-fast broadband speeds for seven years.

In fact, it launched its first broadband DSL internet product called Jetstream in 1999 with an "unconstrained" maximum available download speed of 8 megabits per second, for an entry-level price of $90 a month and a data cap of 600 megabytes.

The plans offered by Telecom this month have the same download speeds as the old Jetstream plans but the entry-level package is $29.95 with a 200-megabyte data cap.

Telecom general manager of consumer marketing Kevin Bowler said it removed unconstrained speeds from the internet packages on sale in 2003 because customers were not buying them in large enough numbers.

It decided to bring back unconstrained speeds next month because customers were increasingly using the internet to download larger files, such as videos, music, gaming and other interactive services, said Bowler.

But Internet New Zealand executive director Keith Davidson said Telecom removed unconstrained speeds for most customers because it was concerned about what he said was its "underinvestment in the network" and its ability to cope with large numbers of customers on high-speed plans.

"They were starting to see users come on, so this was a way of manipulating the network to get the traffic into manageable segments rather than investing in the network itself."

In 2000, Telecom slashed speeds for most customers from unconstrained to speeds of 128 kilobits per second and dropped the price from $90 to $50 a month.

Bowler said the company cut the speeds because most customers were using broadband for simple functions, such as email and web browsing.

"It was important to develop a mass broadband market and that is what has happened."

Existing customers had been given the choice to stay on "grandfathered" full-speed plans after 1999, he said.

David Diprose, regulatory manager at competitor ihug, said Telecom's unconstrained speeds paled in comparison to next-generation broadband technology commonly available overseas - called ADSL2+ - with maximum available speeds of 24 megabits per second.

"If Telecom were up with the play internationally they would have introduced this two years ago," he said.

Telecom said it would begin the roll-out of ADSL2+ in March next year and expected that it would enable the delivery of high-definition video services.

Data this week from the Organisation of Economic Cooperation and Development shows New Zealand remains at 22nd place out of 30 OECD countries for broadband uptake.

The country's low OECD ranking was one of the reasons the Government announced in May it would break open Telecom's monopoly on its lines to achieve better and cheaper internet services.