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Commission releases study into New Zealand’s mobile services market

Telecommunications Commissioner Dr Stephen Gale said competition indicators such as pricing, coverage and choice of mobile services were trending in a positive direction for consumers.


Devdiscourse News Desk New Zealand
Updated: 16-05-2019 08:38 IST
Commission releases study into New Zealand’s mobile services market

The study found that while consumers consider switching providers to be a reasonably simple process, there is currently some inertia when it comes to switching. Image Credit: Pixabay

The Commerce Commission has today released the preliminary findings of its study into New Zealand's mobile services market.

Telecommunications Commissioner Dr Stephen Gale said competition indicators such as pricing, coverage and choice of mobile services were trending in a positive direction for consumers.

"We have three established mobile network operators in New Zealand and all are performing well on most measures of quality. According to Opensignal, New Zealand currently ranks 8th out of 88 countries for 4G speed. Further, mobile service prices are generally lower than OECD averages, and consumers tell us they find it easy to compare plans and switch providers," Dr Gale said.

"However, there is room for improvement in some areas. Prices for large data plans are noticeably higher than Australia and while mobile data use grew 69% last year, reliable 4G coverage is not so widespread. Information on performance measures like call dropping rates and coverage gaps is also hard to find."

The study found that while consumers consider switching providers to be a reasonably simple process, there is currently some inertia when it comes to switching. The Commission has begun further work to better understand the impact of this inertia on consumers.

Dr Gale said the key challenge for competition in the future is the allocation of spectrum.

"Spectrum is a key cost for the three network operators: Vodafone, Spark, and 2Degrees. Imbalances in spectrum holdings between operators – across all bands – can affect competition. Our view is that, in its design of future spectrum allocation processes, MBIE should have wholesale and retail competition matters at the forefront of decisions."

Competition is emerging for network operators to sell wholesale services. This allows 'virtual' operators such as Vocus and The Warehouse to sell mobile services to consumers, without having to build their own mobile network.

"We see no need to regulate at this stage but will keep an eye on the ability of new 'virtual' operators to access wholesale services. We expect more spectrum and consumer engagement will help this market to develop where it is commercially viable," Dr Gale said.

"Overall the study found that consumers are more satisfied with mobile than with fixed-line services, but there is still room to improve. We will continue to focus on consumers as part of our telco retail service quality work."

The Commission is inviting submissions on the preliminary findings by 28 June 2019. A copy of the report can be found here and an infographic detailing key findings is here.

The Commission has also released several expert reports alongside its preliminary findings. These were commissioned as part of the study and include reports on the 'virtual' operator landscape globally and locally and a view of the global industry trends relevant to mobile services.

COUNTRY : New Zealand

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