IDC says telco recovery will be slow

IDC: Telco recovery will be slow

IDC says telecommunications sector revenue was flat last year despite the impact of the Covid pandemic. Across the sector revenues for connectivity services declined 0.1 per cent in the year to June 2021.

The research company forecasts a slow post-Covid recovery. It expects a compound annual growth rate of 1.6 per cent between now and 2025.

IDC says future growth will be “driven by forecast improvements in mobile service revenue and broadband despite declines in legacy voice, fixed data and access revenue.

“As Covid related restrictions ease IDC foresees a greater level of normalcy for the industry will resume beyond mid-2022.”

Telco sector reinventing itself

Monica Collier, IDC Associate Research director says the industry is reinventing itself after the pandemic with a fast-evolving shift in strategies. She sees an increased focus on collaboration, partnering and investment.

“There is increasing activity around joint ventures, partnerships, infrastructure sharing, increasing network utilisation and new investment opportunities. The industry has historically seen assets such as network infrastructure as a competitive differentiator, but it is now eyeballing the wider opportunities available,” she says.

IDC notes the increasing role of non-traditional players in the sector. Senior market analyst telecommunications, Wiji Gedera says “Sky’s recent broadband market entry is another in a line of broadband entrants from other industries. These non-traditional participants are all about churn reduction and they aren’t feeling the margin pinch like the telco retailers”

Starlink would be another non-traditional broadband retailer.

Collier says she expects to see fresh thinking and different perspective from these competitors and that will keep the New Zealand market on its toes.

High Court rules on broadcasters paying TDL

A new High Court judgement could see broadcasters contributing to the $10 million annual Telecommunications Development Levy.

The TDL is, in effect, a tax on larger telecommunications companies. Each pays a proportion depending on their share of the market. Adding broadcasters to the list of payers will reduce the cost to telcos.

The 2018 amendments to the Telecommunications Act removed the exemption for broadcasting from the definition of telecommunications. The Commerce Commission took Optus, Kordia, Sky TV and TVNZ to the High Court which has agreed their networks can be used for telecommunications.

Telcowatch shows Spark ahead in mobile

Spark topped New Zealand’s mobile market share in the third quarter of 2021. It has a 36 per cent market share, a mere sliver in front of Vodafone which is on 35 per cent.

Adding in Spark’s Skinny subsidiary’s 7 per cent market share gives Spark a clear lead. Meanwhile 2degrees remains in third place with a 22 per cent market share.

Figures from Telcowatch show little in the way of quarter-on-quarter change. If there is any noticeable change it is that Spark has opened the gap with Vodafone.

Telcowatch is a quarterly snapshot of New Zealand’s mobile market based on numbers from Datamine. The company monitors 2.9 million active mobile devices. It does not include machine to machine devices or smart meters.

Orcon broadband free to Covid-hit businesses

Orcon is offering six months free broadband to companies hit by a downturn in business due to the Covid pandemic. The deal is worth about $500 to each company. Orcon says it is contract-free, obligation-free and available now. The offer is open to any small business which has qualified for the Resurgence Support Payment, Wage Subsidy or Small Business Cash Flow Loan Scheme.

Vodafone expands mobile coverage

Vodafone says it added seven new mobile sites during September. It added three Rural Connectivity Group sites to its network and upgraded 10 existing sites. In the same period it added CAT-M1 IoT technology to 263 RCG towers.

The new towers were mainly in the Bay of Plenty covering Te Puke South, Kawerau Town, Whakatane North West, Ohope Beach Central and

Opotiki Town. Elsewhere there are new towers at Massey University’s main campus in Palmerston North and at Kuriwao Hill in Southland.

Skinny offers six months free broadband

In a bid to woo new business, Spark’s Skinny subsidiary is offering six months free broadband for anyone signing for a 12-month contract.

TCF trumpets price falls as inflation leaps

Statistics NZ released figures on Monday showing inflation hit 4.9 per cent in the recent quarter. That’s the highest rate in a decade.

A press release from the Telecommunications Forum timed to coincide with the figures shows prices in the telecommunications sector are heading in the opposite direction.

In the last year prices for telecommunications equipment has dropped 2.6 per cent while prices for services have fallen 0.9 per cent. In the last decade equipment prices have fallen 18 per cent while service costs are down 10 per cent.

In other news…

A report from Spark’s Qrious unit examines the state of artificial intelligence in New Zealand. It warns that four out of five organisations have not reached what it calls “AI maturity” and risk being left behind.

Microsoft has awarded Vodafone NZ its Gold security competency status. That’s a way of showing the telco is prepared to help Kiwi companies stay safe online.

The NZ Herald reports Air New Zealand customers have been on the wrong end of email scams involving Airpoints.

Apple launched new MacBook Pro models.

Auckland-based network business Fastcom has acquired IT services provider Sietec NZ and its subsidiaries.

Katherine Hayward is Vodafone’s new head of customer experience. She was recently at Bank of New Zealand.