KEY POINTS:
TelstraClear is promising big changes to the New Zealand telecommunications market following the signing of a deal to use Telecom's network for a new nationwide mobile service.
The two companies said an agreement approving the move was signed today by Telecom acting chief executive Simon Moutter and TelstraClear chief executive Allan Freeth.
"This is an opportunity now for us to be, firstly the third entrant into this mobile market, offering a TelstraClear mobile service, rather than a resold one as we did previously," TelstraClear head of wholesale Raymond O'Brien said.
A new mobile service will pit TelstraClear against Telecom and Vodafone. Previously TelstraClear had a mobile agency agreement with Vodafone, using Vodafone's network, but a TelstraClear spokeswoman said that under that agreement TelstraClear had little ability to differentiate.
Mr O'Brien said that beyond being able to provide a new mobile service, today's deal also provided TelstraClear with an opportunity to be the second full service provider in the market, competing with Telecom, offering mobile and a full range of fixed services, including voice and broadband.
TelstraClear, the local subsidiary of Australia's Telstra Corp, is this country's second largest provider of fixed line phone and internet services.
"It's just a great, great change in the market," Mr O'Brien said of today's deal.
"We will be providing our own different products, not just a rebrand of something, providing our own pricing packages, structuring them differently, and for large customers in particular, structuring packages which are customised to their requirements."
TelstraClear did not have to do anything physical to the network to get the new mobile service under way, although it did have the opportunity to provide its own differentiation at a technical level, Mr O'Brien said.
The agreement had been in the pipeline for quite some time, with "furious activity" in the past month.
He would not say what TelstraClear was spending to set up the new service , except that "it's a lot of money".
"A lot of it of course is looking at how we address the market, how we manage our own processes for getting people on board," he said.
"It truly is a separate mobile offering, it just happens to use some of the same infrastructure, which is very efficient."
For New Zealand it was a "huge step function change".
Today's move comes as regulatory pressure mounts for greater competition in the country's mobile market.
Earlier this month the Commerce Commission said in a draft recommendation on mobile roaming and co-location services that greater regulation was needed to increase competition in the mobile phone market.
"New Zealand and Slovakia are the only OECD countries which do not have three or more mobile operators," Telecommunications Commissioner Ross Patterson said at the time.
In April, TelstraClear pulled out of a planned $50 million converged mobile/broadband service in Tauranga that was to be the pilot of a wireless network called Unplugged.
- NZPA
