Broadband Investment Fund Processes, criteria and FAQ

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Broadband Investment Fund Processes, criteria and
FAQ
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Agenda

• Background Context
• Processes Timelines
• Criteria and FAQ
• Applicant Toolkits
• Joint Procurement Group

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Background Context

• Broadband Challenge
• Announced 2006 24 million contestable fund
  which aimed to
• Support initiatives to bring broadband to areas
  without it
• Provide high-speed fibre networks to urban areas
• Regulatory Changes
• The Telecommunications Act 2006 (No.2)
• Introduced new regulatory services
• (ie. local loop unbundling, naked DSL)
• Empowered the Telecommunications Commissioner to
  take a more strategic role
• Introduced non-discrimination measures
• (ie. Operational separation of Telecom New
  Zealand)

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Background Context

• Broadband Investment Fund (BIF)
• Announced in 2008 Budget 340 million
  contestable fund to accelerate broadband
  investment
• 325 million operating and 15 million capital
  funding available over a maximum of five years
  split over Rural and Urban areas
• 250 million Urban Fund 75 million Rural Fund
• Aimed at
• Facilitating high speed broadband to businesses
  and entities such as municipalities,
  universities, schools and hospitals in urban
  centres
• Extending the reach of broadband into underserved
  regions
• Improving the resilience of New Zealands
  international connections

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Processes Timelines

• As a result of the feedback received from the BIF
  consultation document, applicants have a choice
  of either a One-Stage or Two-Stage Application
  process
• Two-Stage Applicants
• Applicants submit an Expression of Interest and
  Full Application
• One-Stage Applicants
• Applicants bypass the Expression of Interest
  stage and proceed straight to the Full Application

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Processes Timelines
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Processes Timelines
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Processes Timelines

• Application Development Assistance Grants (ADA)
• Urban and Rural Applicants may apply for funding
  to assist with the preparation of a Full
  Application
• Up to 10 of the total BIF funding applied for,
  to a maximum of 100,000
• Aimed at local authorities and community interest
  organisations
• Only available for Two-Stage Applicants

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Eligibility and assessment criteria

• Divided into urban and rural criteria
• Rural areas without terrestrial-based broadband
  infrastructure capable of providing broadband
  service with a speed capability of 1 Mbps or
  greater
• Urban by default, all other areas
• Bundled bids are acceptable (discussed later in
  FAQs)

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Urban criteria

• Section A Eligibility criteria
• Nature of the applicant Network entity
• Nature of the project must be a broadband
  access network covering a specified geographic
  area
• Wholesale and open access requirements
  applicant can choose the layer of open access
  (funding 103350 depending in part on this)
• Fit for purpose requirements access to Key
  Public Users (tertiary institutions, schools,
  health organisations) demand addressed liaison
  with local authorities
• Government funding sought 103350
• Wholesale pricing methodology for at least
  5yrs actual pricing for at least 3yrs

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Urban criteria

• Section B Assessment criteria
• Projects benefit and effectiveness criteria
  (60) likelihood of a successful,
  cost-effective project that achieves following
  objectives
• Provision of significant community benefits
• Satisfaction of a community demand that has not
  been met by existing commercial providers
• Maximises the use of Broadband Investment Fund
  contribution
• Applicant capability and project risk assessment
  (40) - applicant has organisational and
  financial capability to
• Deliver the project
• Operate and maintain the network and
• Ensure that the business model has a viable
  long-term future

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Rationale for urban criteria

• Encourage infrastructure roll-out in a targeted
  manner avoid duplication of infrastructure
• Focus on key public users schools, businesses
  etc
• Technology-neutral fibre is obvious option, but
  satellite and wireless-based solutions will be
  considered where appropriate recognising that
  one size does not fit all
• Adhering to telecommunications policy
  best-practice principles - open access
  futureproofing this is seen as a key benefit
  derived from public funding

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Rationale for urban criteria

• Aim is to develop regional partnerships bottom
  up approach
• Rationale is that the business case for increased
  broadband infrastructure roll-out is often
  dependent on identifying and aggregating demand
  in local communities
• Implicit rationale is to encourage telcos,
  infrastructure providers, local and regional
  councils, educational institutions, health
  organisations, schools and local communities to
  collaborate
• By encouraging this cross talk, demand can be
  identified and more robust business cases can be
  developed

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Rural criteria

• EOI stage
• Confirm that a projects proposed service area
  does not have terrestrial-based broadband
  infrastructure capable of providing broadband
  service
• Brief examination of likely outcomes of project
• Demonstrate involvement of suppliers with a
  strong track record
• Explain how project will be implemented
  preliminary business plan

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Rural criteria

• Full application stage
• Leverage ratio seed funding requirements,
  including the level and ratio of private
  co-investment (higher levels will be preferred)
• Open access level of access
• Ability to compete the project build on time,
  within budget and provide users with a range of
  broadband services
• Ability to achieve minimum of 1 Mbps and
  preference of 5 Mbps access speeds
• Extent of estimated community benefits improved
  services to schools, health organisations
• Long-term project financial viability
• Other benefits

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Rationale for rural criteria

• More flexible criteria, reflecting unique needs
  of rural areas
• Criteria are expressed in broader terms than for
  the urban criteria
• Often the business case for rolling out fibre to
  rural areas is more difficult to make
• Aimed at accelerating deployment of broadband
  infrastructure at 1 Mbps or greater in rural
  areas that are currently not served
• Focus is more on achieving minimum speed
  requirement, and benefits to the community (less
  so on the business case)

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FAQs

• Open access
• Applicant can specify the layer at which they
  wish to provide open access this was changed
  following submissions
• Open access is best practice internationally
  increases competition and provides for
  futureproofing
• We recognise that deeper open access can affect
  the business case, so deeper open access will
  generally attract higher Government funding (up
  to 50)
• Three main levels of open access identified
• Passive network level i.e. open access to duct
  (more fibres can be installed) open access to
  dark fibre the deepest form of open access
• Open access to duct but closed fibre, OR
  closed duct with open fibre likely to attract
  up to 33
• Bearer services / ethernet just a bitstream
  likely to attract up to 10

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FAQs

• Extensions to existing broadband networks
• Can be eligible for funding not ruled out
• Will often involve extensions/spurs to existing
  closed networks (i.e. no open wholesale access
  to the existing network elements)
• While extensions to closed networks are not
  optimal, a key factor will be the benefits to the
  community in some cases it may be more
  important just to have some infrastructure
  present

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FAQs

• Satellite or wireless-based solutions
• Can be eligible for funding if provides a
  community-based solution more likely to be
  appropriate in rural areas where
  terrestrial-based solutions are not viable
• Not excluding innovative use of satellite
  technology where it provides community-based
  solutions in remote rural areas
• However, individual satellite connections to
  residences will not be funded
• Primarily due to the minimum speed requirements
  set out in the criteria (1 Mbps or greater)