Bill Bennett


Tag: orcon

IDC says telco recovery will be slow

Telco sector revenues were flat last year. IDC forecasts a slow recovery.

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 percent 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 percent 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.”

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 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

Telecowatch Q3 2021Spark topped New Zealand’s mobile market share in the third quarter of 2021. It has a 36 percent market share, a mere sliver in front of Vodafone which is on 35 percent.

Adding in Spark’s Skinny subsidiary’s 7 percent market share gives Spark a clear lead. Meanwhile 2degrees remains in third place with a 22 percent 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 percent 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 percent while prices for services have fallen 0.9 percent. In the last decade equipment prices have fallen 18 percent while service costs are down 10 percent.

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.

IPOs on hold as 2degrees, Orcon talk merger

Merger talks between 2degrees and Orcon dominate this week’s news coverage. Here Bill Bennett looks at what a merger might mean for the sector. 

IPOs on hold as 2degrees, Orcon talk merger

Orcon and 2degrees are in merger talks. If they strike a deal the pair would form a third force in New Zealand’s telecommunications market. One that is better placed to compete with Spark and Vodafone.

Both companies were preparing floats. These plans are now on the back-burner. This is not the first time the pair have discussed a form of merger. A few years ago 2degrees looked at acquiring the business when its was operating as Vocus New Zealand and the Australian parent wanted a fast trade sale.

Last night 2degrees US-based parent company Trilogy International Partners issued a statement following a trading halt. It said its had paused its initial public offering of shares in 2degrees “in order to consider a possible alternative transaction with another party”. That’s the nearest the two have come to confirming the news.

How a 2degrees, Orcon merger could reshape the telco sector

A merger between the two companies would cement 2degrees strategy of moving from a mobile carrier to a full service telco.

While this move has been in train for years, Orcon would bring its broadband scale and its considerable enterprise and government business along with its cloud and data centres. It also has a retail energy business that it uses to build product bundles to improve customer stickiness.

Orcon has previously struggled to add mobile to its portfolio thanks to New Zealand’s immature Mobile Virtual Network Operator market Combined the two would have around a billion dollars in revenue. The potential for cost savings would be considerable, more than $100 million.


Little would change immediately in the mobile market. The Commerce Commission’s 2020 monitoring report says Spark and Vodafone each have around a 40 percent share. Which leaves 2degrees on 19 percent.

The remaining one percent is made up of MVNOs. Adding Orcon’s share of the tiny MVNO business won’t move the mobile market dial. However, the merged business has an opportunity to build mobile sales to Orcon’s fixed line customer base. Over time the market share should grow.


In contrast, a merger would immediately reset competition in broadband. The Commerce Commission monitoring report says Spark is the largest broadband retailer with a 40 percent market share.

Vodafone is second with 21 percent. Orcon comes in at number three with 13 percent of the market and 2degrees is next with a 7 percent share.

This suggests a combined 2degrees-Vocus business would be equal second with Vodafone and a long way ahead of the next player Trustpower which has six percent market share.

Wider telco market

Each year the Commerce Commission counts what it calls ‘qualifying revenue’ for New Zealand telcos to determine how much each should pay towards the Telecommunications Development Levy.

While it’s a useful tool for comparing the size of industry players, the calculations include fibre wholesalers. That aside, a combined 2degrees and Orcon would account for around 11.5 percent of the market.

In round numbers that’s around a third the size of Spark and half the size of Vodafone. The next largest retail telco is Trustpower, a long way behind with a 0.8 percent market share.

Australian write-down takes Kordia into the red

Kordia took a $55 million hit at it prepared its Australian operation for sale. That pulled the state-owned network company down to a $47m loss for the year. It made a $9.6 million profit in 2020.

The sale has yet to get regulatory approval. If it goes through, it will, in effect, halve the size of Kordia. Neither Kordia, nor the buyer, Ventia, has revealed the deal price. Revenue for the year was up a whisker at $122.9 million compared with $119.5 million a year earlier. EBITA was flat at $31.8 million.

Kacific cut prices as satellite competition warms

Kacific says it has cut the price of its satellite broadband terminal kit by as much as 50 percent. Prices for New Zealand now start at US$440 (around NZ$630). This compares with around $913 for the rival Starlink hardware.

The company says the hardware is good for speeds of up to 50Mbps down and 10Mbps up. However local resellers quote the download speed at 30Mbps. An uncapped 30Mbps plan on Kacific costs around NZ$290 a month.

CommComms seeks to extend number portability

The Commerce Commission says it plans to extend number portability for another five years. The existing arrangement is due to expire in December. When it renews there will be a small change, customers will be asked to send a confirmation text before numbers are ported to a different carrier. This measure aims to protect customers against fraud.

Vodafone copper to go in six months

Vodafone says it will move around 10,000 customers from old style copper landlines to more reliable digital technology by April next year. Depending on their circumstances customers will move to fibre, wireless, HFC or VoIP services on copper-based broadband connections.

The company says it will save customers money.

2degrees opens trophy cabinet

It may be the smallest mobile carrier, but 2degrees is celebrating a raft of awards for the quality of its network. Ookla, the company behind Speedtest named 2degrees as New Zealand’s most reliable 4G network, the most consistent 4G network and the network with the best 4G availability.

The carrier also topped the recent Opensignal Awards for providing the best upload speed experience, the best video experience and the best 4G availability.

In other news…

CommsDay reports Datagrid has acquired land for its Southland data centre. It has picked a 43 hectare site near Invercargill. Facebook suffered a six hour outage earlier in the week and had its failings publicised by a whistleblower. I discussed this with Kathryn Ryan on RNZ Nine-to-Noon.

Spark CEO Jolie Hodson talks about dealing the the digital skills shortage in an interview I reported for the NZ Herald’s Mood of the Boardroom.

A massive data breach saw more than 100GB of data from game streaming service Twitch posted online.

Reseller News reports on Kordia’s cyber security academy launch.

Microsoft’s Windows 11 Aotearoa keyboard is covered by the NZ Herald.

BusinessDesk says German firm eKomi has acquired Crossware, the Auckland email specialist. (Story behind paywall).


The Download 2.0 is a free weekly wrap up of New Zealand telecommunications news stories published every Friday.

All it requires is an email address. Your address is only used to send out the newsletter. It will not be sold to anyone.

I’m not collecting the data for anything other than sending out the newsletter. You name isn’t going to be sold anywhere.

Spark chooses Nokia to speed 5G rollout

This week: A trial run of The Download 2.0, a weekly wrap of New Zealand telecommunications news. You can subscribe below to get the newsletter delivered to your email inbox every Friday. 

Spark chooses Nokia to speed 5G rollout

Nokia says it has won a deal to supply radio access network (Ran) technology across a large part of Spark’s 5G rollout. The contract will also see Nokia upgrade 4G equipment at the sites.

After a modest start Spark has accelerated its 5G rollout plan. Spark’s FY21 results presentation revealed plans to cover 90 percent of the population by the end of 2023. The move represents a significant capital investment.

Spark’s plan assumes government will have made the necessary spectrum available by then. That’s not guaranteed.

In the early stages of its 5G roll out, Spark awarded contracts to Samsung, a relative newcomer to the network equipment scene.

Previously Spark had worked with Huawei to build its 4G network. That company is now, in effect, blocked from building 5G networks in New Zealand.

Nokia will use its latest AirScale portfolio including the company’s ReefShark System-on-Chip technology. It says this is energy efficient and will allow customers to connect at ten times existing speeds while using less power.

Spark has previously said its accelerated 5G programme will give the company a competitive advantage. The new technology will increase its capacity, offer customers greater speed and expand the reach of its fixed wireless broadband offering.

ComCom signs off Mercury’s Trustpower acquisition

After an investigation the Commerce Commission has given the green light to Mercury’s planned acquisition of Trustpower’s retail business. The regulator says the move is unlikely to lessen competition.

While Trustpower is an energy business, it is New Zealand’s fifth largest retail broadband provider. At the end of last year it had a six percent market share.

Trustpower sells fibre, fixed wireless broadband and mobile phone services. In many cases its customers bundle broadband and mobile services with power.

2degrees announces board ahead of planned float

While telco 2degrees has yet to confirm it will list later this year on the New Zealand Stock Exchange, it has named seven board members in preparation for the float. The seven are Kathryn Mitchell, Ken Tunnicliffe, Mark Cairns, Meg Matthews, Brad Horwitz, John Stanton and Erick Mickels.

In the winter 2degrees held meetings with potential institutional investors in New Zealand and Australia. Majority shareholder, Trilogy International partners has said it aims for an IPO either at the end of this year or early in 2022.

Vocus also plans to float its New Zealand business later this year.

Havelock North 4G tower build back on

A report at Stuff says building work on a Spark 4G tower in Havelock North has resumed. Construction work stopped in 2019 after protests and the site remains controversial with residents.

Online retail surged as New Zealand locked down

Slice Digital, an affiliate marketing network, reports online traffic and sales through its service increased dramatically in August as the nation locked down. Traffic was up 78 percent in the second half of August compared to the first half while sales increased by 162 percent. September sales are running at a 129 percent increase on August sales.

Vector works with Google

Vector is working with Google’s X division to build a map of its Auckland power distribution network. The goal is to build a virtual simulation of the network then use this for planning. The pair say it will help Vector get ahead of increasing demand for clean energy, renewable power and prepare to deal with a large electric vehicle fleet.

Tex Edwards behind supermarket plan

2degrees founder and Hawaiki Cable director Tex Edwards was in the news this week promoting a plan to upset the supermarket duopoly. It’s a move that echoes his involvement in establishing a third mobile network more than a decade ago. If Edwards succeeds with getting his plans off the ground, it will be familiar territory for at least one of his new rivals: Foodstuffs CEO Chris Quinn was a Telecom NZ executive when 2degrees emerged as the third mobile company.


The Download 2.0 is a free weekly wrap up of New Zealand telecommunications news stories published every Friday.

All it requires is an email address. Your address is only used to send out the newsletter. It will not be sold to anyone.

I’m not collecting the data for anything other than sending out the newsletter. You name isn’t going to be sold anywhere.

Flip fibre versus uncapped fixed wireless broadband

Skinny, Vodafone and Flip all chase broadband customers looking for low prices. How do the uncapped fixed wireless broadband plans compare with the lowest cost fibre option?

Skinny now sells an uncapped fixed wireless broadband plan for $60 a month. It’s $10 cheaper if you are a Skinny mobile customer.

Vodafone has a similar product selling for $65 a month. Again, it’s $10 a month cheaper if you have a mobile plan.

These two new uncapped deals give the broadband market a new burst of competition.

At first sight they are roughly in-line with the least expensive fibre broadband plan. That would be Vocus’ Flip brand.

Flip will sell you an unlimited fibre connection for $14 a week. That works out at $728 a year. Skinny’s fixed wireless costs $720 a year.


The two have more in common than price. Flip customers living in Chorus fibre areas get a connection running at 50 Mbps down and 10 Mbps up. In other parts of the country the down speed is 30 Mbps.

On a good day Skinny and Vodafone fixed wireless customers will see similar speeds.

In both cases the speed is more than enough to stream Neon or Netflix. There’s headroom for Zoom video conferences while others are online. Children should be able to do homework while parents work from home.


You’ll notice the last but one paragraph starts with “On a good day…”. That’s because fixed wireless broadband speeds can change over time. Everyone in an area shares the same wireless spectrum. If a lot of users connect at once, the performance drops.

The most recent Measuring Broadband Report notes the average speed of fixed wireless through the day is 25 Mbps, but the average goes down to 21 Mbps at peak times.

Average is an important word here. There will be people who get above average speeds while others will get below average speeds.

21 Mbps is enough

Even the lower 21 Mbps speed is good enough for streaming video. Yet you may run into problems, fixed wireless broadband is less reliable than fibre. The Measuring Broadband report found no regular outages on fibre. Fixed wireless did not do as well.

While this might spoil your viewing or online gaming, it’s not a big deal. Surveys show urban fixed wireless customers are almost as satisfied with their service as fibre customers.

Latency can be more of a concern. This is the time it takes for a signal to travel to its destination and back. Fibre is low latency. Fixed wireless is, in comparison, high latency. It means online games react slower to your actions. If you work from home it means more lag in video conference calls. Mind you, in video calls this lag is rarely a deal breaker.

The uncapped fixed wireless broadband small print

There is one huge difference between fixed wireless broadband and a low-cost fibre account from a provider like Flip.

When Flip says unlimited plans, there are no ifs, no buts, no qualifications. That’s not the case with fixed wireless.

Both fixed wireless service providers talk about fair use. Vodafone calls its plan Unlimited but that’s not the right word. It’s hard to find the fair use policy on the Vodafone site. This link will help.

The important part says:

“If your usage of our services materially exceeds the range of estimated use patterns, we will consider your usage to be excessive and/or unreasonable. We may contact you to advise you that your usage is in breach of our Fair Use Policy, and request that you stop or alter your usage to come within our Fair Use Policy.”

You couldn’t describe that as clear. Skinny uses different words but it amounts to the same thing. Both tell you unlimited does not mean there are no limits.

Location, location, location

You can buy Flip’s unlimited fibre plan anywhere on the nationwide fibre network. At the moment that’s over 82 percent of the country. In a couple of years it will be close to 90 percent of New Zealand.

Although the mobile data network has a broad reach, unlimited fixed wireless broadband plans is urban areas only. And there’s a limit on how many connections there can be in any given area. Fixed wireless service providers manage performance by limiting the number of connections.

In other words, you may not be able to get fixed wireless at your address.

Flip unlimited fibre costs about the same as today’s uncapped fixed wireless broadband plans. It’s usually faster and always more reliable. No-one is watching to see how much data you use.

The fixed wireless service providers have closed the price-performance gap with fibre ISPs. Wireless may suit your needs better than fibre, but for most people, Flip is a better deal.

Hyperfibre 8Gbps – 160 times first UFB speeds

It’s less than ten years since Orcon connected the first customers to New Zealand’s Ultrafast broadband network.

The first customers connected in September 2011. Four schools in Whangarei purchased 50mbps plans.

At the time teachers were excited about not waiting to download videos.

This week Orcon connected its first 8Gbps account. The connection runs at 160 times the speed of those first connections.

An 8Gbps Orcon fibre plan costs $200 a month. That’s about twice the price of a Fibre Max plan.

8Gbps Hyperfibre

The 8Gbps symmetric Hyperfibre connection is a Chorus product. It uses the same basic open access fibre network as the first UFB connections, albeit with different switching gear.

This underlines the fibre network’s ability to handle improved performance.

Ed Hyde, Chorus’ chief customer officer says expanding its Hyperfibre family to include an 8Gbps option shows New Zealand is among the world’s most technically advanced nations.

At the time of writing 8Gbps Hyperfibre is available to about 150,000 premises in Auckland and Wellington.


Orcon boss Taryn Hamilton makes no secret his company likes to be the first with new broadband technologies. His company connected the first UFB account, Now it has connected the fastest.

It’s a strategy that has paid off for Orcon. As Hamilton says: “If there’s one thing we have learned over the years, it’s that people will always find ways to make the most of the latest technology.”

When Chorus first talked about Hyperfibre, people inside the wholesale telco saw it as a product for business users. After all, there aren’t any consumer broadband applications that need 8Gbps. Even a busy household’s needs would be satisfied by a gigabit connection.

Yet consumers are buying the fastest possible connections. Chorus says there are now hundreds of Hyperfibre customers. Of those that have the technology. It says 86 percent are consumers.

Moreover, almost two-thirds of customers on Hyperfibre have bought the, until now, fastest 4Gbps symmetrical service.

Fly Air Orcon for business class broadband

Orcon is trying something different. It plans to ask customers to pay $15 more each month to get business class service.

This is a smart idea.

For years, New Zealand broadband competition was all about price. In recent years there have been content bundles. Buy a service and get free Netflix or half price Amazon Prime.

Sky turns this recipe on its head. The company sells lower cost broadband to customers buying its content.

Until now, that’s been about it for broadband competition: a relentless focus on having the lowest price. It’s competitive to the point of companies competing away most of their profits

Competitive but one dimensional

It wasn’t meant to be this way.

When New Zealand’s fibre network was starting-up, one of the big questions was “how will the players compete”.

The Ultrafast Broadband network is open access. That means there’s a wholesale level and a retail level. Wholesalers cannot compete with retailers.

Chorus, Northpower, Enable and UFF are the four wholesalers. They each have a monopoly in set areas.

There’s another important rule behind UFB: the wholesalers can’t play favourites. They must offer the same terms to every fibre retailer.


This means, in effect, fibre internet service providers all sell the same thing. There are nuances about how they set up backhaul and buy international links.

Yet on the whole a Fibre Max plan from one ISP is much the same as a Fibre Max plan from another ISP. In marketing-speak, the options are undifferentiated.

One of the obvious ways to differentiate this fibre ISP from that ISP is to offer better customer service.

This should be easy enough. We all know what good customer service is. And companies know how to provide it. The problem is that it comes at a cost and that’s an issue when margins are pared to the bone.

Orcon has pulled this part of its product offering out, shined it up, and sells it as an option add-on.

Orcon Priority Support

For an extra $15 a month Orcon’s Priority Support customers get pushed to the front of the queue. If there’s a problem, Orcon will send an on-site technician within a day.

On paper this resembles the service offered to motorists by the AA.

For this to work, Orcon has to keep its word. The idea will collapse in days if a forum like Geekzone is full of angry customers who paid the premium and had poor support.

At the same time, Orcon needs to make sure the customers who don’t pay for Priority Support continue to get decent treatment, although not as good as those who pay the premium. If everyday support degrades as a result of this initiative, the company’s reputation will take a hit.

While this idea is original for consumers, it’s in line with what business customers who pay premium prices can expect.

Orcon puts residential on equal footing with business

And that’s the other part of Orcon’s pitch. Orcon chief executive Taryn Hamilton says the company has scrapped the distinction between business and residential customers.

You could look at it as unbundling the distinction.

Orcon has other ideas that differentiate the company from many rivals.

It is one of a handful of ISPs to offer customers Hyperfibre. This is the Chorus product that lifts fibre speeds. There’s a new 2Gbps Hyperfibre option. Orcon will continue to sell 4Gbps Hyperfibre and from early next month will offer an 8Gbps service.

The Wi-fi Pro option promises to give customers a strong wireless network signal throughout their home. Hamilton says the company checks out the size of a customers property and sends enough Google mesh Wi-fi units to provide blanket coverage.

Orcon also has a 4G failover option. Should a broadband connection go down, this will automatically switch to a 4G mobile network. Vodafone offers a similar 4G failover product called the Ultra Hub Plus.

Like Hyperfibre and Priority Support, the 4G network backup is a product that would, in the past, be offered to business customers.