Subsidised internet proves a hard sell

Telecommunications company Spark is struggling to sign up low-income families to its cheap internet deal.

The $15 for 30GB Spark Jump deal has 5000 subsidised connections on offer, but after one year only about 500 families had signed up.

Spark Foundation general manager Lynne le Gros said the lower than expected pick-up rate was due to challenges identifying the thousands of families who lacked a home internet connection.

She said the telecommunications industry needed to collaborate on the issue so school children could do their homework and not be left behind.

But competitors were not playing ball. Vodafone New Zealand, for example, does not offer an equivalent deal to target families without a connection.

Vodafone Foundation manager Lani Evans said its approach to helping disadvantaged children was more holistic. ‘‘Price is only part of the picture.’’

She said Vodafone NZ had allocated $20 million over the next 10 years to fund charity collaborations and internal accelerator and internship programmes to ‘‘halve the number of young people at risk of exclusion’’.

She said a subsidised deal for lowearning families was on the cards for Vodafone’s future but it was not the foundation’s primary focus.

ASX-listed Vocus Group owns the Slingshot, Orcon, CallPlus and Flip phone and internet brands in New Zealand. Flip and Slingshot, which market themselves as cost-effective providers, do not have specific offers for low-income families.

Vocus’ consumer general manager, Taryn Hamilton, said Flip and Slingshot’s offerings catered to all incomes.

Flip’s cheapest home phone and internet deal was $55 a month, while Slingshot’s was $60 a month.

Le Gros said families often refrained from asking for the Spark Jump deal because they were used to being turned away from internet providers.

Those who had a bad credit history were usually unable to get a debit account, which was required to sign up to most internet services, she said. ‘‘They cannot do another ‘no’.’’

In contrast, Spark Jump payments are made through Skinny Broadband prepay accounts. Income information is not required to get the deal, le Gros said.

Le Gros said Spark wanted to work with other telcos, including Vodafone NZ, to break stigma and give internet access to those who need it.

Evans said her foundation would be willing to work with any individual, industry or political body that shared its vision.

The Spark Jump programme partnered with schools and community organisations to find names and contact details of families with children under 18 years old and no internet connection, but many were left unidentified, she said.

Le Gros said a lack of awareness, not funds, was not the problem. Government funding would not necessarily help the cause, she said.

Labour ICT spokeswoman Clare Curran said, if elected, her party would consider investing in telcos to help fund programmes like Spark Jump.

Communications Minister Simon Bridges said a National-led Government would not subsidise private telcos: ‘‘It is up to the market to provide the best deal on internet packages.’’

He said his party’s ultra-fast broadband expansion plan was ‘‘a far cry from the poor internet access New Zealanders had in 2008 under Labour’’.

Across the ditch, Australian internet provider Start Broadband has provided 4500 days of free broadband to families earning low incomes, typically less than AU$40,000 (NZ$44,000), through its Life Changing Connections programme.