Telecom secures mobile deal

By PETER GRIFFIN

Telecom has sealed an important wholesale agreement in Australia with third-ranked mobile operator Vodafone.

The deal is the second part of its strategy to secure a foothold in the crowded Australian mobile market.

Telecom will buy capacity on Vodafone's network at wholesale prices and sell it to customers under AAPT's Cellular One brand name.

Cellular One was previously a reseller of mobile services provided by Optus and Vodafone.

Telecom is not predicting how many customers it hopes to pick up through the wholesaling agreement, but spokeswoman Linda Sanders said it expected a big increase in Cellular One's customer base of 250,000.

"It means we can have a much better relationship with the customers, from delivering the minutes to them to offering packages."

The long-expected agreement will probably give AAPT a bigger pool of customers to draw on when it upgrades its services to the third-generation (3G) network being developed by Hutchison Telecommunications and expected to start in 2003.

Telecom, which has a $400 million investment in the network, had planned to launch its own CDMA network in Australia.

The plans were shelved this year, contributing a $256 million asset write-off to Telecom's balance sheet.

Vodafone, which shed 41,000 customers last quarter - about 2 per cent of its customer base - will do further business with Telecom in both the Australian and New Zealand markets as part of the deal.

Vodafone's director of wholesaling, Mike Buckling, said: "We've committed to increasing the level of business we do with each other in transmission and international carriage."