is a
Wellington -based
Telephone Company formed at the
Privatisation of the
New Zealand Post Office in 1990 and is also New Zealand's second largest
Mobile operator. Telecom is the largest company by value on the
New Zealand Exchange (NZX) and movements in its share price have a great influence on the index of movements in the top 50 companies.
Telecom was formed in 1987 from a division of the
New Zealand Post Office and
Privatised in 1990. The selling price is still considered by many to be extremely low, given that Telecom had a
Monopoly of all phone lines in
New Zealand at the time. Others consider that the capital requirements to modernise the network were better provided by private enterprise than the government.
- The New Zealand Post Office divests itself of the newly created Telecom which was created as a State Owned Enterprise (SOE) on March 31 .
- The Government-owned Telecom Corporation is to have a commercial focus. It purchases telecommunications assets of the Post Office for .2 billion and work begins on improving the services and network.
- Telecom launches its 025 mobile network and CDPD mobile data network. The New Zealand Telecommunications market is progressively deregulated.
- Telecom implements a NZ$200 million dollar fibre-optic cable connection between Australia and New Zealand.
- Clear Communications reaches an agreement on local service interconnection.
- Telecom creates First Media Ltd to develop a cable television network across Auckland and Wellington, called First TV
- Saturn Communications Limited (now TelstraClear) enters the residential phone market in Wellington.
- Telecom buys back NZ$1 million of its shares.
- Ameritech sells down its 24.8% shareholding in an international public offering.
- Bell Atlantic issues exchangeable notes that are convertible into the Telecom shares that it owns.
- Telecom celebrates 500,000 mobile customers connected to its mobile network.
- Southern Cross Cables Limited, half owned by Telecom, announces plans to build a fibre-optic cable linking New Zealand with Australia and North America.
- Vodafone New Zealand buys BellSouth and starts a campaign to attract Telecom customers to its network.
- Telecom establishes a presence in Australia, buying 78% of AAPT , Australia's third-largest telecommunication company.
- Telecom upgrades its nationwide payphone network to smart card technology.
- Telecom's fast Internet service based on ADSL technology, called JetStream , is launched and rolled-out progressively in local exchanges.
- Telstra merges New Zealand operations with Saturn to form TelstraSaturn Limited.
- Xtra signs up its 300,000th customer.
- Telecom Mobile, the mobile division of Telecom , celebrates 1,000,000 customers connected to its mobile network.
- The New Zealand Government conducts a comprehensive review of the regulatory regime.
- Telecom raises its AAPT shareholding to 100%.
- The Government passes the Telecommunications Act, setting up a Telecommunications Commissioner.
- TelstraSaturn buys Clear Communications to form TelstraClear .
- Telecom releases Bitstream, a 256kbit ADSL service sold at wholesale prices (at approximately 10% below the retail price) to other ISP's.
- Telecom's mobile customers find out that their privacy and security is not safe on the Telecom network, when a Phreaker named ^god releases an Exploit to the Media allowing access to almost anyone's Voicemail .
is
New Zealand 's second-largest
Mobile Operator , with about 49.5% market-share, behind
Vodafone . Telecom operates
AMPS , Digital
D-AMPS /
TDMA and
CDMA , including EV-DO mobile phone systems in New Zealand. AMPS and D-AMPS service is sold under the 025 brand and CDMA services are sold under the 027 brand. Telecom is set to turn off the 025 network in
2007 . Most of its customers have migrated to the 027 network. The 027 CDMA EV-DO network is marketed as T3G, a 2 MB third-generation mobile system.
The following shows customer numbers and market share information for Telecom Mobile, including both 025 and 027 customers. Since
Vodafone New Zealand took over BellSouth in the late 1990s Telecom's market share has dropped every year.
In 2005 Telecom launched New Zealand's first 3G network, using the brand name T3G. Being first into the 3G market, along with aggressive marketing and a $10-a-month text message package, has allowed Telecom to claw back some market share from Vodafone. In November 2005 Telecom reported 72,000 new mobile phone customers, compared to 27,000 for Vodafone.
Recent information shows Telecom to have 1.6 million customers, against Vodafone's 1.9 million.
Telecom has been criticised for using its status as a government-protected monopoly to charge high prices whilst providing poor service,
as an example ; on XTRA Jetstream it can cost over to download 100GB of data in a month, plus monthly access fees (at residential rates, business is more expensive). While there are competitors in the cellular and toll-call markets, it has proved difficult for other companies to establish residential services due to Telecom’s control of local loop services. Telecom has also leveraged its control of residential services to establish the country’s largest
ISP ,
Xtra .
Competitors allege that Telecom engages in unfair practices to prevent competition from arising, and resells broadband capacity to Xtra at lower prices than to other
ISP s.
In July .
In
an article published on
25 October 2005 , Telecom claimed that the reason for poor broadband uptake in New Zealand was because of free local calling. Telecom stated “customers have the option of moving to faster broadband services, but free local calling creates a disincentive by allowing them to use dial-up for as long they want.”
However, internet experts disagreed and even the secretary of the OECD
took a shot at Telecom.
More Recently , Telecom has been the subject of criticism in an episode of ''
Campbell Live '', during which Teresa Gattung was grilled by the
Show’s Host , and an episode of the New Zealand edition of ''
Sunday ''. Critical articles have been published by various magazines and newspapers—among the most noticeable of these was published by the ''
National Business Review '', in which it was stated that “Far from being ‘Xtraordinary’, as its multimillion dollar advertising would have you believe, Telecom is strangling the nation’s advancement.”
{Link without Title} The New Zealand Government has been investigating whether it may need force Telecom to unbundle the network, in doing so allowing other companies access, allowing almost instant improvement of broadband service for consumers.
The
New Zealand Treasury has estimated the economic loss from Telecom's monopoly to be in the region of – million a year. Another study commissioned in
1998 by rival company Clear (now
TelstraClear ) estimated that the loss was million a year.
