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Telecom Powers Past 250,000 Broadband Milestone

Telecom Powers Past 250,000 Broadband Milestone

4 November 2005


Telecom has achieved its goal of 250,000 residential broadband customers two months ahead of schedule with nearly half the growth in residential customers for the quarter coming from wholesale.

Telecom had 244,086 residential broadband customers at 30 September 2005, an increase of 19% on the previous quarter with 38,159 new connections over the period.

The 250,000 target was surpassed during October.

“Reaching the 250,000 milestone two months ahead of schedule is a great achievement and shows that New Zealanders are seeing the benefits of the speeds and applications that broadband delivers,” Telecom Chief Executive Theresa Gattung said today.

“Broadband is growing fast – residential numbers in New Zealand have more than tripled in the last year.’’

The quarter included the launch of the Xtra-ordinaries campaign, and the downloadable Xtra Security Suite, with more than 5,000 customers taking up the subscription based security service in the first month.

Telecom expects broadband momentum to continue in the current quarter with competitive prices, a focus on customer service and the introduction of exciting broadband content such as the new online Xtra Games and Xtra Photos services.

Around 45% of total residential broadband growth for the quarter came from competitors’ customers, under Unbundled Bitstream Service (UBS) and wholesale broadband plans, up from 34% in the quarter to June 2005, and 23% in the quarter to March 2005.

“The surging growth in wholesale connections and market share is evidence of the success of the wholesale market in New Zealand.

“Wholesale providers are now getting a substantially larger share of the market attracting 30% of the growth in new connections since the introduction of UBS in November 2004.

“This has been assisted by Telecom Wholesale promotions such as free connection and free modem offers – and an above the line generic broadband advertising campaign launched in recent weeks.”

Including business and residential customers, there were 301,813 broadband customers on Telecom’s network as at 30 September, 2005.

Key Broadband Facts

* 250,000 milestone passed in October, two months ahead of schedule
* 1 in 6 households in NZ now have a broadband connection
* The number of residential broadband customers in the past year has tripled
* 45% of the growth in residential customers in the last quarter came from wholesale
* 39% of Telecom customers are on high speed (1Mbps or greater) plans
* Pricing of Telecom’s 1Mbps plans compares favourably with international benchmarks
* 85% of NZ schools are now on broadband
* NZ now has nationwide broadband coverage: 93% of the country covered by fixed broadband (DSL) while wireless broadband & satellite cover the remainder of NZ

Broadband reporting - Quarterly connection summary

30-Sep-05 30-Jun-05 Quarter Growth

Residential

Retail 197,027 175,644 21,383

Wholesale 47,059 30,283 16,776

Total Residential 244,086 205,927 38,159

Business

Retail 49,055 47,712 1,343

Wholesale 8,672 5,859 2,813

Total Business 57,727 53,571 4,156

Total

Retail 246,082 223,356 22,726

Wholesale 55,731 36,142 19,589

Grand Total 301,813 259,498 42,315

Since the inception of UBS, 30% of residential broadband customers has come from wholesale (up to the end of October 2005). The following table shows progress to 30 September 2005 for which latest public figures are available.

30 October 2004 30 September 2005 Growth % of Growth

Residential broadband customers

Retail 84,089 197,027 112,938 70.9%

Wholesale 788 47,059 46,271 29.1%

Total 84,877 244,086 159,209 100.0%

ENDS

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