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Broadband key to New Zealand tech aspirations

Political turmoil elsewhere is making the country appealing to international tech workers.

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New Zealand Broadband:

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Canada’s tech scene isn’t the only beneficiary of U.S. President Donald Trump’s protectionist policies and rhetoric. So is New Zealand, according to the New York Times.

The tiny country of fewer than five million, most famous for serving as the setting of The Lord of the Rings movies, is being inundated with tech workers looking to flee unfavourable developments elsewhere. A recent international tech recruitment effort saw more than 48,000 applications, dwarfing the 2,800 expected, the Times reports.

The reasons are obvious. Aside from a more congenial political situation, the real estate prices are also good, the setting is idyllic and the attitude is progressive. Add it all up and you have a place that many young tech workers are likely to find ideal.

New Zealand has long wanted to turn itself into a tech hub but, as the Times reports, its isolation at nearly the bottom of the world has worked against it.

I lived and worked there more than a decade ago and it’s true – the nearest other country (Australia) is at least a three-hour flight away, so it’s easy to feel trapped. Of course, it’s not necessarily all that bad to be trapped in a veritable paradise.

Ironically, Trump supporter and adviser Peter Thiel became interested in New Zealand for a time and even led investment efforts there. But as the newspaper article documents, he eventually lost interest and moved on.

What the Times misses is the fact that New Zealand has also historically had one other major obstacle preventing it from becoming a tech hub: bad broadband.

In my time there, the country’s woefully slow and terribly expensive internet service was the tech story.

Everyone from regular users to multinational companies such as Microsoft and Symantec to the nation’s screen council – responsible for hooking Hollywood studios in following The Lord of the Rings’ success – complained that it was hurting their innovation and business efforts.

There was even the famous story about director Peter Jackson shuttling the music for his films back and forth to the United Kingdom on hard drives because it was too slow and expensive to transmit digitally.

The broadband was so bad that nobody wanted to pay for it, which is why a decade ago New Zealand languished near the bottom of the Organization for Economic Co-operation and Development in uptake.

The government got involved in 2006 and started cracking down on the culprit, the phone incumbent Telecom New Zealand and its monopoly, but improvements were slow-going. British actor Stephen Fry, in New Zealand in 2012 to film The Hobbit, famously expressed his frustration:

The situation has only gotten better in recent years following the structural splitting of Telecom NZ into separate network-owning and retail companies in 2011. Network investment and speeds have slowly but surely improved, usage caps have increased or vanished and pricing has come down.

As a result, New Zealand has risen from the bottom of the OECD barrel in terms of broadband penetration to 14th, just three spots below Canada. Pricing is also similar between the two countries now, amounting to about 34 cents (U.S.) for every megabit per second of speed, compared to 30 cents in Canada.

All told, many of the necessary conditions are indeed in place now for New Zealand to finally realize its tech aspirations. It’s hard not to cheer such a great country and fantastic people on from afar.

Meanwhile, here in Canada, you can’t help but wonder what benefits might result if our telecom companies were similarly broken up.

1 Comment on Broadband key to New Zealand tech aspirations

  1. Hear hear!

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