2degrees and One NZ plan network
Radio access networks to merge in wholesale joint venture
2degrees and One NZ say they plan to merge their radio access networks in a jointly-owned wholesale business.
The transaction will be subject to approval from the Commerce Commission and the Overseas Investment Office. If they get the go ahead the companies aim to complete the project in the first half of 2027.
A new company will manage shared physical assets like antennas and base stations. Both carriers will then buy network capacity back from the business.
However, both companies will remain retail competitors. Each carrier will keep control of its own radio spectrum, core networks, fibre backhaul and satellite partnerships.
Building on earlier relationship
The deal builds on an earlier partnership. In 2020, 2degrees and Vodafone (now One NZ) signed a landmark infrastructure sharing agreement. That deal allowed 2degrees to run its radio equipment on roughly 200 of One NZ’s rural towers, ending national roaming in those areas.
In November 2023, 2degrees extended the approach further, switching from roaming to using its own spectrum over One NZ's cell sites in the last remaining pockets of the country, closing out its national coverage. This week’s new proposal expands that concept into a nationwide business model.
It also reflects deep, existing sharing in rural regions. Through the Rural Connectivity Group (RCG), a joint venture formed by One NZ, 2degrees and Spark, all three major operators already share single sets of antennas and equipment on hundreds of remote towers which are part funded by the government.
RCG proved that network sharing could work in New Zealand without harming retail competition.
Shifting competitive ground
The strategy marks a sharp turn from past industry practice. Fifteen years ago, mobile operators jealously guarded their cell sites. Physical networks and tower footprints were treated as key competitive advantages. Building duplicate towers was standard practice to keep rivals out of local markets.
That model has broken down under the heavy cost of 4G and 5G upgrades. Passive tower assets were previously sold off to specialised infrastructure companies. Now, active radio hardware is also being treated as a shared utility expense.
The battleground for mobile competition has moved elsewhere. Operators now compete on core network performance, satellite partnerships, retail pricing and customer service.
If regulators approve the plan, Spark will be left as the only New Zealand operator running a fully separate national radio network.
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Bill Bennett
Chorus profit up as fibre connections grow
Chorus has reported higher revenue, earnings and net profit for FY26 as fibre connections and data use continued to grow while the company cut costs and capital spending.
Operating revenue rose $15 million to $1.029 billion in the year ended 30 June, while EBITDA increased 3 percent to $726 million. Net profit rose to $37 million from $4 million a year earlier.
Fibre connections increased by about 32,000 to 1.147 million. This represents 96 percent of Chorus’ connections. Fibre uptake reached 75.9 percent of serviceable addresses, moving closer to the company’s target of 80 percent by 2030.
Traffic rising
Average monthly data use on the network rose 9 percent to 731GB in June, with upload traffic continuing to grow faster than downloads.
Operating expenses fell $6 million to $303 million and capital expenditure dropped $40 million to $375 million. Operating cash flow increased 4 percent to $740 million.
Chorus has brought forward nationwide copper retirement to 2028 as copper connections decline.
The company will pay a 36c final dividend, taking the FY26 total to 60c a share.
For FY27, Chorus expects EBITDA of $730 million to $760 million and a minimum dividend of 62c a share.
Analysis: Solid result but not what investors wanted
While positive, investors see Chorus’ $37 million profit as less impressive than it looks on the surface. The fibre company has a good story for investors, but it is not a high growth business.
This explains why the share price, which was trading above $9.60 before the result tumbled below $9 after the announcement. Investors were not looking at the sizeable increase in profit, but at the revenue picture. Fibre continues to grow, with revenue up 6 percent on the year, but copper revenue is falling.
The outlook reinforces the point. Chorus expects FY27 EBITDA of $730 million to $760m. Even at the midpoint, that would be only a 2.6 percent increase on FY26. The company is growing, but not at a rate that makes a big jump in valuation easy to justify.
There is a strong cash flow and dividend story. Operating cash flow rose 4 percent to $740 million and Chorus is promising at least 62 cents a share in dividends next year. But investors also have to weigh that against the capital needed to maintain and develop the network and the company’s debt. The result therefore looks more like a solid execution story than a growth surprise.
2degrees reaches direct-to-device satellite milestone
2degrees has opened an AST SpaceMobile satellite ground station in Marton, completing voice, video and data tests using standard smartphones. The facility is among the first commercial AST SpaceMobile stations globally.
The station will support satellite-enabled mobile connectivity in New Zealand.
2degrees says customers with 4G and 5G smartphones will eventually be able to make calls, send messages and use data in areas beyond the reach of existing mobile networks without a satellite phone or additional hardware.
Engineers from the two companies tested the service in August 2026. The tests included voice and video calls and mobile data.
2degrees chief executive Mark Callander says the locally built ground station will allow calls, data and messaging to originate and terminate on the company’s core network without transiting another country or jurisdiction.
The company has not set a launch date, saying it will continue testing and launch when satellite coverage is sufficient for a viable service.
ComCom updates fibre rules following review
The Commerce Commission has confirmed changes to the Fibre Input Methodologies following its first review of the framework. The key change is a new investment test for major fibre expansion projects, assessing consumer benefits while promoting competition.
Following the review, the Commission has also streamlined capital expenditure assessments with clearer information requirements and more predictable timelines, and refined rules on connection costs and insurance.
Telecommunications Commissioner Tristan Gilbertson says the changes balance investment support with consumer protection. He says the fibre-specific cost of capital settings will be addressed in the next stage of the review.
Chorus warns against resilience regulation creep
A Chorus submission warns the Commerce Commission not to turn its proposed resilience guidance into a de facto regulatory regime for infrastructure investment.
While Chorus says it supports the Commission’s work on resilience, the company is concerned that the proposed guidance could inadvertently make it harder to get sensible resilience investment approved. This is particularly the case with smaller or integrated projects.
In what can be read as a warning about regulatory creep, Chorus says it would not support the guidance becoming a platform for broader resilience reporting, maturity assessment, performance regulation or process compliance without a clear statutory basis and demonstrated end-user benefit.
Chorus says excessive evidence and process requirements could discourage the smaller, incremental investments the guidance is intended to encourage. It wants lighter-touch evidence for smaller or integrated investments, with more intensive analysis reserved for material, novel or highly uncertain proposals.
The company also says resilience is often one of several reasons for a network investment, alongside asset renewal, capacity, technology and service continuity. It says not all investments with resilience benefits should be treated as standalone resilience proposals.
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Market forecast to growth at 31 percent annually until 2035.
Tuanz takes nuanced view on social media ban
The Technology Users Association of New Zealand (Tuanz) supports the government’s proposed legislation to reduce youth online harm. It singles out the tough penalties and mandatory annual safety assessments for praise.
However, CEO Craig Young warns against a blunt age ban, urging a "Security by Design" approach instead. The advocacy group raised critical concerns regarding privacy risks from age verification, potential VPN circumvention, social isolation for vulnerable youth and the need for mandated digital literacy.
Tuanz calls for close collaboration between government, industry and educators during the select committee process to build practical, privacy-respecting safety solutions.
This time last year Chorus returned to profit
Chorus returned to the black making a net profit of $4 million in 2025. This compares with a $9 million loss the previous year. Announcing the result, chief executive Mark Aue said Chorus is reshaping itself into a simpler, fibre-only digital infrastructure company, with a target of 80 percent uptake by 2030.
Five years ago the Commerce Commission set Chorus’ regulated asset base at $5.5 billion, laying down the fundamental accounting baseline that would determine how much the network operator could charge for wholesale fibre access.
While the decision provided long-awaited regulatory certainty after years of haggling over how to calculate historic UFB losses, key questions remained about whether the framework offered enough incentive for ongoing network expansion and future infrastructure investment.
In the event the regime now in place protects baseline infrastructure and keeps retail prices predictable, but relies on targeted policy or subsidies rather than market returns to fund high-cost rural expansions.
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