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Spark, TUANZ positive about ComCom mobile market study

31 Aug 2018

The Commerce Commission has released an issues paper calling for submissions on its initial assessment of the mobile market being carried out under Section 9A of the Telecommunications Act 2001.

The Commission is seeking evidence on how the market is performing for consumers now and whether there are any current or potential issues preventing it from delivering greater benefits for New Zealanders in the future – issues that regulation might help resolve.

Telecommunications Commissioner Dr Stephen Gale says the mobile market study has been examining consumers’ ability to engage effectively with mobile service offerings, service providers’ ability to enter the mobile market, and how changes in technology may affect competition.

“On the consumer side, as an example, we have been examining how easily New Zealanders can compare retail offers, identify which mobile plan best suits their needs, and then switch to their preferred plan or provider,” Gale says.

“We are keen to hear from the industry and consumers on whether improvements can be made. We are also studying what affects the viability of new possible mobile providers – ranging from resellers like Vocus and Warehouse Mobile through to operators who might acquire spectrum and build new networks. One focus is why resellers, so-called ‘mobile virtual network operators’, have a much lower market share here than in other countries.

“Looking ahead, new mobile technologies like 5G will benefit consumers but we are checking whether their adoption by telecommunication companies may affect competition. One question is whether any potential new entrants will be able to access the 5G spectrum. Another is whether existing regulation of mobile infrastructure sharing needs to be eased off or stepped up.”

Spark GM for Regulation John Wesley Smith says the paper canvasses a wide number of issues and Spark looks forward to engaging with the Commission on these.

“We are pleased to see the Commission’s paper acknowledges the excellent pricing, coverage and broadband speeds the New Zealand mobile market is delivering to customers today,” Smith says.

“The Commission’s paper confirms that New Zealand mobile prices for the most popular mobile bundles are significantly below the OECD average prices and that New Zealand’s three mobile network operators are continuing to invest heavily in their nationwide mobile networks, covering a total of 98% of the population.  We believe those market outcomes confirm that competition in New Zealand mobile markets is in good health.

“The issues mentioned in the paper for further consideration are more about how competition might develop as we look forward into the future.  We are supportive of the Commission looking into those issues.

“However, we would emphasise that on these forward-looking issues - particularly with regards to the allocation of spectrum for 5G networks - time is of the essence. We would urge the Commission to move as quickly as possible to conclude this process, as Spark (and our competitors) have some large investment decisions to make in a short period of time.”

TUANZ (Telecommunications Users Association of New Zealand) CEO Craig Young is equally positive about the announcement.

“We are really pleased to see the holistic approach being taken by the Commission in this study,” says Young.

“We have been calling for a fully independent study of the market structure for mobile services and so it’s positive to see the range of questions being raised in this papers.

“We reiterate that our members have been clear to us that while they recognise that the NZ market has delivered improved competition and that there are areas we are well ahead of in comparison to other countries, they want to see this review as being comprehensive addressing the questions of where we are and what we need to ensure that strong competition remains in this market.”

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