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Mobile competition – better analysis shows problems remain

Media Release

21 May 2014

Mobile competition – better analysis shows problems remain

Today’s Commerce Commission announcement that mobile competition is not delivering for business and on account customers dispels the myth that New Zealand’s mobile market is competitive – and now it’s time to find out why.

2degrees Chief Executive Stewart Sherriff says the Annual Telecommunications Monitoring Report reveals there are three distinct mobile markets – prepay, on account and business – painting a distinctly different view of competition than previous reports.

“New Zealand’s highest spending mobile users deserved this. The Commission has acknowledged its past approach of looking at an operator’s share of total connections can be ‘misleading’. It’s now time for an in-depth look into switching barriers so we can see why customers who want to move, don’t,” says Mr Sherriff.

The Monitoring Report shows that competition in prepay has been vigorous, but on account or business customers have not switched providers.

Mr Sherriff says today’s findings show there is still work to be done to ensure long-term competition benefits all mobile users.

“2degrees has been actively competing for on account and business customers for more than two years, rolling out a national network and opening 49 retail stores. Despite this, we continue to hear from mobile users who are frustrated that they cannot take up a deal from 2degrees, even in situations where we can save them 20% or more on their monthly bill.”

Mr Sherriff says the reasons vary, but a common area of complaint is the finer detail of contract terms, which customers are confronted with when they call their provider to say they are leaving for 2degrees. In some cases even finding out those details can be a challenge.

“We look forward to the Commission taking the next step to look into these issues so the incredible value 2degrees has brought to prepay customers is extended to all mobile markets.”

“In the meantime, today’s report will be an important input for policymakers as they prepare for the upcoming Telecommunications Act Review,” he says.


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