There is growing recognition by the public sector, businesses and communities that telecommunications services and infrastructure play an important role in economic transformation, sustainability and social well-being. In this new environment, greater alignment is being sought both within the public sector, and also with local government and the private sector.

Demand aggregation is one strategy that has been successfully employed by communities to improve telecommunications outcomes in their regions. In this context, demand aggregation is about pooling the demand for telecommunications services in a region or sector.

Demand aggregation is a powerful mechanism for government, local government and the business community to stimulate new capital investment in broadband network infrastructure and to promote competition by providing potential investors with greater certainty when assessing an opportunity. The aggregation of demand can result in greater benefits than can be achieved by users entering into individual contracts. Demand aggregation strategies rely on establishing a business case which will attract investment in the provision of new services, or the extension of existing services.

Demand aggregation has been used by Australian and American state governments, European communities and the Canadian government to assist in driving new broadband investment, particularly into areas outside the main central business districts. This overseas experience indicates that combining e-government, e-education and e-health initiatives can be a significant contributor in demand aggregation strategies.

Local government can significantly influence broadband deployment on a regional basis through aggregating its own demand for broadband services. It can also have an impact through supply-side initiatives, for instance, by providing an open access ducting network in association with other council infrastructure projects. The Ministry of Economic Development is working with Local Government New Zealand to establish broadband expertise and toolkits to support local government broadband initiatives.

Local business representative groups such as regional chambers of commerce have a strong interest in supporting broadband deployment initiatives, if the result is better broadband services for local business. Achieving alignment of central government, local government and business demand for high-speed broadband services will be an important lever.