Telecommunications commissioner Tristan Gilbertson is concerned about the way telcos are marketing their services as Chorus prepares to close local copper phone networks.
Yesterday he sent an open letter to the companies, in effect telling them to clean up their act.
The move comes after complaints from consumers that they are getting confusing or incomplete information about their technology options.
Ball of confusion
It can be complicated because there are two separate processes going on at the same time. Yet there’s evidence telcos are deliberately adding to the confusion.
First, from next month Chorus is able to decommission the local copper network in areas where fibre is offered.
It can’t turn copper off overnight. There’s a long consultancy period and an agreed process. People have at least six months from getting the first letter. They get two or three reminders from Chorus along the way.
Chorus wants to decommission copper in part because running two networks is an unnecessary expense.
There are areas where no-one continues to use copper. And other areas where the number of users is small. In these places the cost-per-connection of maintaining the network can be very high. And anyway, a copper network is more expensive to maintain than fibre.
Goodbye public switched telephone network
The second process is the Spark is turning off its old-fashioned voice technology that uses copper lines. That’s the public switched telephone network or PSTN.
In both cases the changes mean people must find alternatives.
And that’s where things can get nasty.
Each of the three mobile phone companies sell fixed wireless broadband in competition with fibre.
Hello fixed wireless broadband
Fixed wireless isn’t as fast or reliable as fibre. Nor is it necessarily cheaper. Yet for many people it is good enough. Lucky fixed wireless broadband customers with good connections like the service.
Mobile companies like it in part because they can push their mobile phone networks harder and get a better return on their investment in towers and antennae.
They also like not paying the monthly wholesale fibre fee to the likes of Chorus, Enable, UFF or Northpower. This means they get a much better margin selling fixed wireless.
Which means the mobile companies push their fixed wireless options to customers and back-pedal on mentioning fibre. There are cases where telcos tell customers they don’t have a choice.
There are also cases where customers are told the changes are about to happen even when they could be months or years away.
Enter the Commerce Commission
The Commerce Commission only gets involved in cases when it gets a lot of complaints or queries from the public. It has had a lot of communication from people on the receiving end of misinformation.
There’s no question misleading marketing is out there. At times the deception is deliberate.
It harks back to when Telecom CEO Theresa Gattung talked at a conference about telecommunications companies being able to use confusion as a marketing weapon.