KEY POINTS:
Electricity retailer TrustPower is likely to spark up the telecommunications market under a deal with telco Maxnet.
The Tauranga-based company says it will offer its 219,000 mainly rural electricity customers the option to get phone, tolls and internet services on one bill through a wholesale agreement with Maxnet.
TrustPower already has 16,000 phone customers since its purchase of Oamaru internet and phone company CallSouth in April.
It also has 1000 tolls-only customers - a legacy of a reselling deal with internet provider ihug which ended early last year.
TrustPower's retail general manager, Chris O'Hara, said reselling someone else's product had created "difficulties".
"At that point we needed to make a decision whether we got out of the telecommunications space altogether or whether we got serious about it."
TrustPower created the Kinect brand, now used for the tolls-only customers, which will offer electricity and phone packages from next month.
He said TrustPower estimated it would sign up 45,000 customers in the next three to five years - and would be "very satisfied" to hit the 100,000 customer mark.
TrustPower would be "looking closely" at the CallSouth brand after the Kinect launch with a view to merging the two, said O'Hara.
He said customers who got power and tolls from TrustPower would save 10 per cent on their toll bills. By including internet services in the bundles, customers would save another 10 per cent.
TrustPower will wholesale internet services from Auckland-based internet provider Maxnet, which has an arrangement with CallSouth.
Maxnet managing director Brett Herkt said that allowed the company to fully utilise bandwidth it bought from Telecom and TelstraClear.
"It brings a lot of economy of scale into our business."
TrustPower's existing billing and call centre service made it easy to add other utilities to customers' bills, O'Hara said. Once the telco brand was established TrustPower would look for niche opportunities laying fibre-to-the-home and business in new building developments.
"We don't see ourselves as a major network investor but certainly some technology investment is on the radar for us." The company would hire more people for the Oamaru call centre, previously part of the CallSouth business.
TrustPower has appointed Peter Gregory to head its telecommunications business. Shares closed up 10c at $8.40 yesterday.
Powering up
* Trustpower listed on the NZX since 1994.
* It has 219,000 electricity customers.
* Infratil has 50.5 per cent shareholding.
* Tauranga Energy Consumer Trust holds 33 per cent.
