Thursday, 26 September 2019 10:50

Increasing competition benefits NZ mobile consumers, says regulator Featured

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Increasing competition benefits NZ mobile consumers, says regulator Image Ambro, FreeDigitalPhotos.net

New Zealand mobile consumers are benefitting from an increasingly competitive market environment and the established presence of three independent national network-based providers, according to the country’s competition regulator The Commerce Commission.

The Commission’s comments follow its completion of a study into the mobile services market.

“Having assessed the state of competition in the mobile market we haven’t identified any particular problems or structural issues that could be hampering competition,” Telecommunications Commissioner Dr Stephen Gale said.

Dr Gale said the study also concluded that there is an emerging market for ‘virtual’ operators to sell mobile services to consumers without having to build their own mobile network.

The Commissioner said this includes companies such as Vocus, Warehouse Mobile and Kogan which offer mobile services based on commercial wholesale agreements with the network operators.

“Trustpower also intends to enter this market and, like Vocus, bundle mobile offers with its existing broadband and energy services. Because of these developments, the Commission does not consider there is any need for regulation of wholesale access at this time.”

Dr Gale said: “With Spark, Vodafone and 2degrees each having a network of similar technology with similar geographic and population coverage metrics, looking forward we consider the allocation of spectrum to be particularly important for future competition”.

“In our view, there is a need for wholesale and retail competition matters to be at the forefront of decisions relating to MBIE’s upcoming allocation of 5G spectrum.

“While we consider that, overall, mobile services are in good shape, we do think there is room for consumers to keep pressure on providers to compete harder on price and service quality.

“At the moment a lot of mobile customers tend to stick with their providers and are somewhat reluctant to switch even though they know it is easy to do so.”

The study found 60% of consumers say it is easy to compare plans though 68% rarely if ever do, and 54% haven’t switched providers in the past 5 years.

“By shopping around more frequently consumers are likely to trigger more competition between mobile providers. We are keen to see more consumer activity and will be looking into ways we can help New Zealanders understand whether they are getting the best deal possible and, if not, consider switching,” Dr Gale said.

Other findings from the study include:

  • New Zealand ranks 8th out of 88 countries for 4G speed and more than 96% of consumers have 4G coverage
  • Average mobile data usage per month has more than doubled in the past two years
  • Prices for mobile services have been falling and compare well with other OECD countries
  • Spark, Vodafone and 2degrees are all profitable and have collectively invested $2.5 billion in their mobile networks over the past decade
  • Average revenue per user has declined slightly to around $25 per month when handset revenues are excluded.

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Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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