When I started out using the internet, I had the best connection possible: the office connection. It was free, it was fast and it was always on.
Of course, eventually I wanted a connection at home and since I was going to start working from home, it had to be the best on offer – high speed “broadband”.
At that time, I got an ADSL connection that the boss agreed to pay $100 a month for (Thanks, Anthony) and it ran at a blistering 1Mbit/s. My Nokia M1122 was the business – it was black and shiny and about the size of a paperback book. By golly, it was the future we’d been promised and at 1Mbit/s I had to be careful with just how much data I used because 600MB a month was *just* enough to work with. I foolishly once updated my work laptop from home and used slightly more than 1GB and it cost double my usual monthly bill.
This was the year 2000 and broadband at home was brand spanking new. Data was a rare commodity, to be hand delivered to you on a cushion made out of money. Forget backing things up because nobody could afford that kind of luxury. Thankfully the era of ‘high definition’ YouTube videos was still science fiction because that kind of content would have bankrupted me in the first week. Each megabyte over your limit was charged at 20c each, so a two-hour 4K movie would cost about $2800.
Today of course things are quite different. Telecommunications is much faster and much, much more affordable. The advent of fibre to the home (the Ultra Fast Broadband project) and 5G mobile services means we have access to incredibly fast connections at relatively low prices. For the same amount I paid in 2000, today you can get a connection that is 1000 times faster with no data limits at all, and with hyper-fibre plans coming on stream, the home user can get 2Gigabit/second, or 4Gbit/s or 8Gbit/s if they want.
Telecommunications is now a vital part of any household’s budget. If you want to be entertained, work from home, study from home or use most of the various services we need each day, you need an internet connection that is fast and reliable. In New Zealand we’re very well placed with the UFB available to nearly 87% of the population and three competing mobile networks that reach more than 99% of the population.
But just how affordable is our internet access?
Each quarter Statistics NZ publishes its household living costs index and in March this year we saw a huge leap up in terms of inflation. For the first time in three decades, annual inflation hit 6.9% and that’s an enormous concern to anyone who needs to buy groceries, pay rent, put fuel in the car or any of the other things we all do every month.
Telecommunications remains the bright spot in all of this. Telco services and products typically cost around 2% of your monthly budget and that’s been pretty consistent over the past 20 years, ever since phones stopped being about voice calls and became about internet access and mobility. Indeed, in the past decade the telco sector has consistently fallen in terms of pricing while other sectors have increased.
Today my household has four people constantly online. Between us we have three or more devices each all desperately keen to talk to the world. My gas meter talks to HQ via its own mobile phone connection and soon I’m sure all my appliances and the car and goodness knows what else will want to connect as well.
Today’s devices and connections are in orders of magnitude better than they were 20 years ago but affordability remains a top priority for telcos. Compared with similar countries, like Australia or the UK, our connectivity is second to none. We have faster speeds available to more customers in more places at more affordable prices, and that’s the key to a successful digital nation.
Paul is the CEO of the Telecommunications Forum.