Mobile market worries watchdog
The country’s competition watchdog is calling for submissions on whether the $2.7 billion mobile market is delivering for consumers, suggesting strong competition can’t be taken for granted.
Telecommunications commissioner Stephen Gale said the Commerce Commission had been looking at whether it was easy for consumers to compare mobile plans, and for new companies to enter the market.
There are three network providers in New Zealand; Spark, Vodafone and 2degrees, as well as a smattering of wholesalers, such as Vocus, Trustpower and Warehouse Mobile that each have small shares of the retail market.
‘‘Where there are a lot of complex choices, or where there are ‘non transparent’ add-on costs – such as excess charges where calling or data allowances are exceeded, or international roaming charges – consumers may find it challenging to compare retail offers,’’ the commission said.
‘‘Although the majority of consumers consider that they are able to easily compare mobile plans, it appears that there may be a significant proportion of mobile users who still face some difficulty.’’
The watchdog also wants to check whether the costs of adopting 5G technology could limit future competition and whether more should be done to encourage mobile companies to share infrastructure such as cellphone towers.
‘‘One question is whether any potential new entrants will be able to access 5G spectrum,’’ Gale said.
The commission expected 5G technology to come to New Zealand in about 2020.
The study is taking place despite claims from Spark and Vodafone that the telco market has been working well.
Submissions close on October 12 and Gale said the commission expected to provide an update on its work towards the end of the year, before possibly holding a conference to discuss possible interventions next year.
Vodafone said the study showed New Zealanders were well served ‘‘by three competing national 4G mobile networks covering 98 per cent of New Zealanders’’ with prices significantly below OECD averages.
The study noted the small market share held by resellers or socalled ‘‘mobile virtual network operators’’ (MVNOs), which include Vocus and The Warehouse, Vodafone acknowledged.
But it suggested that was not a reason for extra regulation.
‘‘In other highly competitive international markets, many MVNOs struggle to differentiate their services where strong retail competition serves all parts of the market with affordable, compelling and innovative services, as we see in New Zealand,’’ it said.
Spark regulation head John Wesley Smith said the issues raised by the commission for further consideration were ‘‘more about how competition might develop as we look forward into the future’’.