Third degree for mobile startup

The Commerce Commission has reprimanded third mobile operator 2degrees over its inability to make full use of a regulation the company had pushed for.

In a letter sent to the soon-to-launch mobile operator the commission said it was "disappointed" in the low number of co-location sites - putting equipment on rival's transmission towers - 2degrees had built.

"Given the emphasis placed by 2degrees on the importance of co-location in the lead-up to, and during the mobile co-location standard terms determination process, the commission expected to see a far greater number of co-location builds by this time," said the letter signed by commissioner Anita Mazzoleni.

The letter noted the significant resources mobile rivals Telecom and Vodafone had committed to making co-location access available.

The commission chided the telco for failing to meet deadlines on a number of technical and reporting requirements.

It reminded 2degrees it could face High Court action, including fines, but said it would not take the matter further.

2degrees chief executive Mike Reynolds yesterday acknowledged the company had been lax in complying with the administrative requirements of the co-location regulation, saying the company had the systems in place but had been tardy with the paperwork.

He said 2degrees was forced to abandon co-location for the first stage of the network build - due to launch in August - because of the drawn-out regulatory process which came to a close late last year.

Prior to the regulation 2degrees had negotiated commercial co-location deals with Telecom and Vodafone.

2degrees confirmed it had "less than 10" co-location sites. These are understood to be on Telecom and Kordia towers.

While 2degrees had originally estimated 33 per cent of its initial network build would be co-located, Reynolds said it would now be limited to 40 per cent of the second phase of network extension. Reynolds said it had also been constrained by Resource Management and District Plan rules restricting the height of cell towers.

In a written reply to the commission, Reynolds said 2degrees had held co-location talks with a "potential fourth operator".

No industry insiders spoken to by the Business Herald were able to identify a potential mobile entrant, but last night CallPlus and Kordia denied it was them and TelstraClear neither confirmed or denied speculation. Wireless operator Woosh had not responded by press time.