ComCom’s 19GB/Month Broadband Use Claim

The Commerce Commission has published an annual report on the state of the telecommunications industry since 2008. The report, which is issued each year in March or April, publishes data collected from operators from a period ending around a year before publication. The April 2013 report, for example, covers the period between July 1 2011 and June 30 2012.

One of the key indicators reported is how much traffic home users consume in a month, and this year it was a surprise.

The amount of traffic used by a residential broadband subscriber in a month can be used to compare New Zealand’s participation in the Internet against that of other countries. It can also be used to determine whether broadband plans and penalties in the market are meeting the demand of the average user. It’s especially important this year, as we enter into a review of the Telecommunications Service Obligations, which may well see Universal Access for broadband replace older obligations such as unlimited local calling and the right to a phone line that supports fax and dial-up Internet.

For the 2010-2011 reporting period, the Commission reported “the average fixed line broadband subscriber is using around 10GB of data per month”, and that this was an increase from the previous year’s report of 7.5GB. This shows a 33.3% increase, which is coincidentally close to the 34% Compound Annual Growth Rate seen across the world as reported by Cisco’s Visual Networking Index.

The growth rate was further reinforced by Cisco’s Dr. Brian Pepper, who in a Commission sponsored conference reported that at the end of 2011 the average New Zealander was using 12GB/month of traffic – a 17% increase over the six months from the end of June 2011.

Given the data points and international trends, we would expect to see figures like this (reported figures in bold, others extrapolated):

2009-06 2009-12 2010-06 2010-12 2011-06 2011-12 2012-06 2012-12 2013-06
5.5 6.5 7.5 9 10 12.0 14.0 16.5 19

The expectation given these trends is that by June of 2012 we’d be up to nearly 14GB/month – not far off from the 16GB/month estimated by Statistics New Zealand and based on reports from end users on their own consumption.

The Commission however in the executive summary of their 2012 report states “Fixed broadband data use also doubled in the last year with the average amount of data traffic per user now at 19GB.” That’s a huge jump, and a dubious claim. Nothing significant occurred in the market to bring about a doubling in traffic utilisation.

Later in the report, footnote 8 on page 24 states “The Commission moved from collecting an average broadband data use figure from respondents to collecting total data broadband data sold by respondents, which was used to calculate an average.” And there’s our answer. Nothing significant did occur – just a major change in reporting.

Why would the Commission move away from using a recognised figure to a measure of how much data is sold by carriers?

I call on the Commerce Commission to publish actual use figures as at the end of June 2012 and to return to publishing actual use figures in future reports, so that the industry and users can have a consistent and realistic benchmark to work with.

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