2degrees sees profit lift 33 percent

Mobile challenger profitable two years running

2degrees followed its 2016 maiden profit with a 33 percent lift in the year ended December 31. The telco saw revenue grow fast than costs. Net profit for the year was $19 million, up from the $14.3 million a year earlier. Revenue climbed 4.3 percent to $732.7 million. Costs excluding finance was up 4.1 percent on the year earlier. The company cut its finance costs and banked a $1.5 million income tax credit.

The company says by the end of 2017 its 4G mobile network covered 96 percent of the population. A year earlier it was 79 percent.

2degrees lost more than 40,000 prepaid subscribers during the year taking the total below a million to 982,600. In financial terms, this is more than offset by an increase in postpaid subscribers. There are now 396,000 up from 372,000 a year earlier.

The total number of mobile connections dropped slightly. 2degrees remains a long way behind Vodafone and Spark which each have around a million more connections.

Postpaid mobile customers are far more valuable than prepaid customers. The average revenue per postpaid user is US$36.32 compared with US$7.98 for prepaid. The numbers come from 2degrees' majority shareholder Trilogy International which reported them to the Toronto Stock Exchange. Trilogy owns almost three quarters of 2degrees.

The Trilogy report also says 2degrees revenue was up 14 percent in the first quarter of 2018.

Spark agile move hits EBITDA forecast

Spark says it plans to speed up its transition to the agile operating model, but costs associated with the move have lead to downgraded guidance for the financial year. The costs will be in the region of $50 to $55 million.

Spark previously told investors to expect earnings before interest, taxes, depreciation and amortisation (EBITDA) would rise by between zero and two percent. The new forecast range is between negative 2.5 and 0.5 percent.

The company says opportunities identified as part of the existing transition encouraged the company to move faster. It will bring forward changes planned for next year to this year. The changes are expected to result in several hundred job losses at the telco with the entire agile project cutting the company's labour costs by as much as 20 percent.

RBI2 build to finish early

Communications Minister Clare Curran says the second stage of the Rural Broadband Initiative will finish ahead of schedule. Both RBI2 and the mobile black spot projects were due to complete at the end of 2022, but are now set to finish a year earlier. She also announced extra funding for communities not covered by the existing broadband upgrade projects.

Curran says the $105 million needed to expand the project will come from Crown Infrastructure Partner funds. She will make further announcements on the expansion in coming months. The extra money to pay for taking improved services to rural communities not covered by the existing programmes are part of the $1 billion Provincial Growth Fund that's managed infrastructure minister Shane Jones.

Spark talks Cortex expansion with GHSB

At BusinessDesk Paul McBeth reports that Spark is talking to the Government Communications Security Bureau about expanding the reach of the intelligence agency's Cortex malware disruption defence.

He says Andrew Little, the minister responsible for GCSB announced the intelligence agency will expand programme, after a successful pilot with Vodafone. The pilot is to have saved almost $40 million of harm from avoided cyber attacks, such as intellectual property theft, copyright and patent infringement, and espionage.

InternetNZ calls for Privacy Bill changes

InternetNZ has called for further improvements to keep New Zealand's privacy regulations up-to-date in its submission to the committee overseeing the new Privacy Bill. The bill was introduced in April and aims to refresh the 25-year-old Privacy Act which was written when the internet was still in its infancy.

The new bill builds the earlier Privacy Act’s 12 information privacy principles. These govern elements like collection of personal information, including reasons as to why, how and where information was collected; the way that information was stored; giving individuals the right to access or correct information about themselves; restrictions on how people or organisations used or disclosed personal information; and how unique identifiers could be used.

While keeping these, the 2018 bill goes on to strengthen the role of the Privacy Commissioner and includes new data breach disclosure requirements.

Jordan Carter, InternetNZ CEO, says: “We support the changes in the Bill but have suggested some adjustments to make them more effective. Privacy matters more than ever in this era of big data and ubiquitous internet. ”

InternetNZ wants the bill to include ideas from the European Union's General Data Protection Regulation (GDPR). It wants local data breach rules to line up with those in Europe and Australia. It also wants to give New Zealanders a new right to be told why information is being held.

Cisco signs for Spark 5G project

Spark says Cisco has signed an agreement to contribute services, technology and capability as the telco prepares for its 5G mobile roll out. Earlier this year Spark held public demonstrations of 5G technology in Wellington and Auckland.

While Huawei is Spark's incumbent mobile network equipment supplier and you count the plausible candidates on two fingers, the company says it has yet to finalise its 5G network technology partners.

Enable finishes Christchurch build, ups speeds

Enable says its has completed its Christchurch fibre build. Chief executive Steve Fuller says: “We installed the last piece of our network in a street at the top of Mount Pleasant – meaning we have completed the project 19 months ahead of schedule. This includes building to more areas than were initially planned when we began".

He says: " It is fair to say that the construction of the network was an enormous challenge in a city that was devasted by earthquakes."

The Enable network covers Christchurch, Rangiora, Kaiapoi, Woodend, Rolleston, Lincoln, Templeton and Prebbleton. The company has over 74,000 customers connected to fibre broadband. The number increased by 24,000 in the last 11 months.

After completing the network, Enable has doubled the speed of its 100 Mbps residential service. Fuller says this is a way of saying thank you.

Spark to pay refunds as Commerce Commission

Customers who left Spark in the last seven years will get a refund if there was still credit in their accounts. The company says 135,000 ex-customers are affected and it will contact them directly.

It says the amounts owed range from a few cents to over $100. The total sum is not large. The move comes following a Commerce Commission investigation. Spark says it is in discussions with the Commerce Commission about a billing system issue.

Samknows wins Commerce Commission broadband monitoring, calls for volunteer

The Commerce Commission says it has picked the dominant global broadband monitoring company Samknows to replace locally owned and operated TrueNet. The deal will cost $2.8 million over three years. It now wants up to 3000 volunteers to help the newcomer collect data. TrueNet had a similar army of helpers, but found them itself. Samknows recently won a similar contract from Australia's ACCC.

Phone sales bounce back

Growth returned to the worldwide phone market in the first quarter of 2018. Research company Gartner reports a 1.3 percent year on year increase during the quarter with almost 384 million phones selling.

The company says the demand for premium and high-end models was suffering because there had only been marginal increases in benefits with recent releases. Meanwhile, the bottom end of the market has strengthened.

Market leader Samsung saw its share of the total drop slightly during the quarter, mainly thanks to competition from Chinese brands. Apple's share edged up. The biggest winners were Huawei and Xiaomi.