2011 New Zealand - Telecoms, Mobile, Broadband and Forecasts

Fibre rollouts commence, bringing fast broadband benefits

BuddeComm’s New Zealand - Telecoms, Mobile, Broadband and Forecasts annual publication provides a detailed overview including statistics and analysis of the regulatory, infrastructure, fixed voice and digital media sectors of the New Zealand telecommunications market. Selected market forecasts and an overview of the key market players are also provided.

New Zealand telecoms reforms are continuing to forge ahead – with issues such as termination rates and on-net pricing discussed internally. The trans-Tasman roaming prices are being discussed on both sides of the Tasman.

The Ultra-fast broadband network is coming to fruition with rollouts commencing by two successful applicants – Ultra Fast Fibre and Northpower – both were announced in late 2010. Another region is still under negotiation with Alpine Energy and the CFH. Services are expected to be available in 2011 and then progressively until 2015 when this rollout is completed. The rollouts cover seven of the 33 CFH regions and cover nearly 500,000 people and more than 12,000 business premises, so uptake will be important for the continued success of the nationwide rollout.

Also announced in late 2010 was the next round of UFB priority negotiations for the remaining 25 regions. Telecom New Zealand was selected to negotiate for all of the 25 remaining regions while Enable Networks in under negotiation for two regions and the Flute Joint Venture for one region.

Fixed mobile broadband uptake grew by more than 30% during 2010 fuelled by wider availability of equipment and cheaper plans, while mobile broadband subscribers held steady. New Zealand has a comprehensive terrestrial-based broadband access availability with over 95% of dwellings, which compares favourably with other OECD countries. In 2010, according to OECD data, New Zealand had a broadband penetration rate of 23% which ranked 18th. With the UFB rollout BuddeComm expects a ranking rise as fibre is rolled out and fibre-usage penetration increases.

While all the telco markets continued to expand in 2010, the annual change in growth has dropped across all but the mobile sector due to the competition in that marketplace. In the mobile sector the newcomer 2degrees is continuing to see its subscriber numbers rise. A record number of subscribers are porting their numbers away from Telecom and Vodafone to the MVNOs and 2degrees. 2degrees has expanded its network with the launch of a 3G network and opened branded customer shops. The closure of Telecom’s CDMA network in 2012 may see further subscribers move to the other networks with Telecom losing further market share as subscribers weigh up the other offers available.

The telecom markets may now see increases in product uptake as studies are showing that consumer and business expectations are on the rise, as is the online advertising market. Also, finally after two years in decline the real growth rate of GDP has turned positive. Other economic trends are shifting positively in 2010, although the rise in GST from 12.5% to 15% may dampen economic activity in 2011.

Market highlights:

• It has been a long time coming as Vodafone slips below 50% market share of the mobile market in 2010;
• The rollout of roadside cabinets passes the halfway mark providing faster ADSL and VDSL2;
• Telecom brings forward the wholesaling of the 3G 850MHZ mobile network;
• Mobile subscribers pass the five million mark at least temporarily;
• The see-sawing fixed-line market increases once again;
• The pay TV market hits 50% household penetration;
• The wireless broadband market that saw massive uptake over the last two years slows down.

New Zealand – Key telecom parameters – 2009 - 2010

(Compiled by BuddeComm, various industry sources)

For those needing detailed overviews, statistics and forecasts, as well as objective analysis on all aspects of the New Zealand telecoms industry, this report provides essential reading and gives in-depth information on:

• An overall market overview with statistics and forecasts;
• Operating overview of the key players in the market including financial overviews;
• Fixed and wireless broadband;
• Overview on smart grids and smart meters;
• The Ultra-fast broadband network and Rural Broad Initiative;
• Telecommunications infrastructure;
• Regulatory developments;
• Digital media and the digital economy;
• Fixed network voice and VoIP markets;
• Mobile communications and regulatory issues covering spectrum developments.

Data in this report is the latest available at the time of preparation and may not be for the current year.