New Zealand - 2009 annual monitoring report shows increasing competition

[commerce commission] The Commerce Commission has today released its 2009 telecommunications monitoring report analysing the state of New Zealand telecommunications markets. As well as looking at developments in 2009, the report also assesses the progress seen since the 2006 amendments to the Telecommunications Act came into effect.

“The report shows that competition in all telecommunications markets has increased between 2006 and 2009. Consumer choice and service quality have improved while prices have fallen,” said Dr Patterson, Telecommunications Commissioner. “However, despite increased competition in the New Zealand telecommunications sector, the market shares of incumbents remain high and markets remain concentrated when compared with other jurisdictions such as the United Kingdom and Australia.”

“Alternative providers of broadband services on Telecom’s network have increased their market share from 24 per cent to 37 per cent in the last three years. Over the same period, broadband uptake has doubled and New Zealand has improved its position when compared with 30 other OECD countries from 22 in 2006 to 18 by 2009. Uptake of broadband is now at or around the OECD average and broadband speed availability and quality have improved significantly,” said Dr Patterson.

“In the mobile market the entrance of a new network operator, 2degrees, has had an immediate impact in terms of consumer choice and competitive offering. Although there is evidence that competition in the mobile market is increasing following the launch of 2degrees, mobile voice usage remains low by international standards. In addition, price and usage vary significantly depending on whether calls or text messages are sent to another subscriber on the same network or to a subscriber on a different mobile network. On the positive side, both Telecom and Vodafone have upgraded their networks for 3G capability, and a number of mobile virtual network operators have entered the market,” said Dr Patterson.

“In the fixed line market, alternative providers of fixed line voice services have increased their market share in terms of connections from 8 per cent to 25 per cent over the three year period,” said Dr Patterson.

2009 annual monitoring report shows increasing competition in telecommunications markets