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Spark New Zealand

Today Telecom NZ becomes Spark New Zealand. It’s a big change for the company.

I worked with Peter Kerr of Stick on a feature series about the name change at Scoop: Igniting the Spark – Why Telecom Wanted To Change. Spark sponsored the story and gave us access to executives, but didn’t interfere with the editorial.

As part of the project I met Jason Paris who is now Spark GM Home, Mobile and Business. At that meeting I got answers to two things about the name changed concerned me:

First, the risk of killing off a well-known brand that took years and millions of dollars to build. It turns out the Telecom brand had effectively become a barrier between the company and the customers it most needs to win over for its long-term prosperity. You can read more about that in the feature, but the simple answer from Paris was that not changing the name presented a bigger risk.

Second, I worried Spark wasn’t original enough. That it would struggle to stand out from the other companies, products and organisations both in New Zealand and around the world with the same name. This is why many corporations choose a unique, made-up name.

In particular, I feared Spark might be difficult to find in Google. I tried this when the news first broke and the New Zealand telecommunications business didn’t show until about the third page of search engine results.

Of course the flurry of activity, Google advertising, other marketing activity, the news and other noise quickly changed this. As you can see from the image at the top of the page, just hours after the name change, Spark dominates the Google NZ search results.

Goodbye Telecom NZ, it’s been great writing about your business over the years. Welcome Spark and good luck.

You need special kit not publicly available in New Zealand until later this year. And, for now, there are only six Auckland sites.

Yet Telecom NZ’s carrier aggregation show where mobile data is heading with a service that has theoretical peak speeds of 300 Mbps — faster than UFB.

At those speeds you could download an 800 MB movie in 20 seconds.

Carrier aggregation works by joining spectrum bands together to give more bandwidth. Telecom NZ’s version joins two bands.

A recent trial by Telstra in Australia joined three bands to reach speeds of up to 450 Mbps. That’s the theoretical top speed, in practice the bandwidth is shared with other users. Even so, the technology dramatically speeds up mobile data.

Telecom NZ says it expects suitable carrier aggregation devices will be available by the end of this year or early next year.

In a statement Chief Operating Officer David Havercroft says when CA devices do come to market, Telecom NZ customers will be able to take advantage of “phenomenal” data speeds straight away.

spectrum

Len Starling, policy and planning manager at the Radio Spectrum Management division of the Ministry of Business, Innovation and Employment, responds to How much spectrum do NZ mobile carriers have?

Firstly, you’re correct that the disparity between the spectrum holdings shown in Vector’s graph (which you published) and the numbers that MBIE previously provided is because Vector’s graph includes a lot of spectrum that is not used for cellular services.

Vodafone owns rights to spectrum in several bands that are not used for cellular services.

For clarity, the spectrum bands currently used for cellular in New Zealand are:

  • 850 MHz (Telecom only) – 3G
  • 900 MHz (2degrees & Vodafone only) – 2G and 3G
  • 1800 MHz (all operators) – 2G and 4G
  • 2100 MHz (all operators) – 3G

In the bands currently used for cellular, the operators hold:

  • Vodafone: 130.4 MHz
  • Telecom: 110 MHz
  • 2degrees: 99.6 MHz (some of which is owned by 2degrees’ shareholders, Trilogy Ltd and Hautaki Ltd) .

Soon, the 700 MHz band will also be used for cellular. All three operators will own rights in this band.

The 2.5/2.6 GHz band can be used for cellular (equipment is available internationally) but is not currently being used for cellular services in New Zealand. This band is particularly good for high population density areas such as Singapore and Hong Kong, not so good in low density places like New Zealand.  In New Zealand no-one has implemented yet.  These rights return to the Crown in 2016 (at the latest) if implementation doesn’t occur.

Secondly, while you are correct that the government would not prevent Vodafone (or any other network operator) from using any of its management rights for cellular services, in practice all New Zealand mobile networks are limited by international standards.

This is because cellular handsets are sourced from the international market. It is unlikely that major handset manufacturers would be interested in manufacturing bespoke handsets just for New Zealand given our small size. Therefore the holdings at 2.0, 2.2 and 3.4 GHz are not practical for cellular services.

Finally, there is not yet any international consensus on what frequencies 5G cellular services will use. While it seems likely that ‘5G’ will eventually be standardised at the international level, there is not yet any agreement on what exactly what 5G will be (apart from general statements like 5G will be faster and/or more efficient than 4G). Most of Vodafone’s unused holdings expire at various times over the next 5-8 years.  It should not be assumed that Vodafone will automatically be allowed to renew those holdings.  The government routinely reviews spectrum holdings five years before expiry and decides whether to make a renewal offer.  For example, the government recently reviewed Vodafone’s LMDS holdings and decided not to offer renewal so those rights will return to the Crown in 2018.

In summary, while there may be room for debate about exactly what should be counted, it is not correct to assume that current total UHF spectrum holdings provide a guide to future capacity of an operator to provide cellular services.