Tuanz CEO Paul Brislen worries about the government’s 700Mhz spectrum sale due to take place later this year.

He fears the sale could see a return to a duopoly as the two big mobile carriers – Telecom NZ and Vodafone – snap up all or most of the 45MHz on sale leaving nothing or just crumbs for 2degrees. He says this would destroy the emerging competitive market for mobile communications.

Brislen has a point.

Although if 2degrees stuck to its 3G knitting leaving the upscale data market to the bigger carriers that could be interesting. Not every phone customers wants a premium service at a premium rate. Some just want a phone service with a bit of data on the side. There would certainly be product differentiation between the carriers.

And it’s possible another party could move in on the 700MHz band. At least one other phone company has talked to me about buying spectrum.

Brislen’s solution is to offer up the spectrum to the three carriers at no cost. He argues they could spend the money they would have paid for the spectrum on network infrastructure.

That’s not daft, but I can’t see the government buying this. And I guess it would leave other players outside looking in. Who knows? Perhaps a new entrant could take competition to a new level.

A comment on the Tuanz post from Reg Hammond suggests acquisition caps would help and then making bidders with unused spectrum elsewhere give up what they don’t need. This sounds good.

I’d feel more comfortable about the process if I didn’t suspect the government has a cargo cult mentality about the ‘free money’ these sales generate. Getting rid of that mentality would be a good start.

I’d also like government to look at any regulation or policy barriers to making MVNOs more effective in New Zealand. They seem to work better overseas.

2 thoughts on “Tuanz frets about mobile duopoly

  1. Make them bid in customer plans, not dollars.

    They posit their plans which would be implemented for 5 years, and spectrum is handed out depending on who has the better plan. If the plan is not implemented in a timely manner or at all or isn’t in the same spirit of the agreement then the spectrum use is shutdown.

    Probably highly impractical and full of legal holes, but in a perfect world…

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