Telecom gets bargain

By PETER GRIFFIN

The Warehouse is offloading its 213,000-strong prepaid mobile phone user base to Telecom, to concentrate on its core business of filling the red sheds with cheap goods.

While Gold Mobile customers bought their phones and prepaid calling cards at The Warehouse, in reality they were Telecom customers, using its 025 network.

As mobiles became affordable and prepay became a popular method of topping up air time, Gold Mobile did brisk business.

But The Warehouse said the business was now "mature", making Telecom a "more natural owner as an efficient network operator".

Gold Mobile customers are relatively low-value, spending on average just $3 a month. Telecom's existing pre-paid customers spend, on average, $8 a month. Contract customers spend about $75 a month.

Telecom's third-party prepaid base dropped around 8 per cent last year. Its own prepaid base dropped 20 per cent. Direct ownership of the Gold Mobile customers will make it easier to market to them, increase average spending and eventually migrate them to the 027 network.

The Warehouse will continue to sell the phones and cards. Gold customers will have access to a wider range of Telecom specials, but must move to a new voicemail system.

The size of the sale, which takes effect on July 1, was not disclosed.