Jarden ticks Vodafone’s $40 wireless broadband
Vodafone’s new $40 per month wireless broadband plan, launched on Friday, has got the tick from wealth manager Jarden.
Although Vodafone had been late to the party, it was now “starting to pull the price lever”, analyst Arie Dekker said. FWA (fixed-wireless access) competition was “starting to benefit users.”
Dekker saw Spark replying with its own price cuts as it strives to hit its target of moving 30 to 40 per cent of its fixed-broadband customers to wireless broadband (which uses a mobile network to deliver fast internet into a fixed premise such as a home or office, negating the need for a landline).
Despite the heightening competitive pressure, Dekker saw further runway ahead for Vodafone and Spark in fixed-wireless — and by extension, further threat to dominant landline wholesaler Chorus.
He noted Spark’s 165,000 wireless broadband customers allow it to pocket more than $80 million per year that would otherwise have gone to Chorus.
But not everyone was such a fan.
“Vodafone’s new $40 broadband offer might create a short-term headline, but the ongoing concerted move by both Spark and Vodafone to convert customers off fibre on to scarce wireless resources is utter insanity from a national perspective,” said Mike Smith, chairman of a lobby group for small, mostly rural ISPs called the Wireless Internet Service Providers Association (Wispa).
“Radio spectrum is the broadband lifeline for 70,000 customers, mainly rural, who have no realistic alternative. More than half New Zealand’s farms get their services through about 40 regional wisps — they get Netflix and the Rugby World Cup at affordable prices and city quality.
“Radio spectrum is key to that. Unlike fibre optic, it’s a limited resource.
“Yet now we have the latest episode in an ongoing campaign by
Vodafone and Spark to use scarce radio spectrum to replace abundant fibre. There will be a tiny financial benefit to a handful of urban users, at a huge cost to rural users who have no alternative.”
Smith said giving the “celcos” (Spark, Vodafone and 2degrees) more spectrum would undermine billions of taxpayer investment in UFB fibre.
“There’s been a relentless attack, to the point that Chorus is now a bounty of up to $800 for customers to return to fibre,” Smith said.
“As taxpayers we should be scratching our heads.
“Why, when we have all shelled out billions for abundant urban fibre, are Spark and Vodafone scrambling to take urban customers away in favour of a scarce form of transmission?”
That resource is even scarcer because last year Communications Minister Kris Faafoi cancelled the 5G spectrum auction to give the Crown breathing space to resolve a longstanding Treaty claim on airwaves.
Instead, a modest amount of 5G spectrum was directly allocated to the major players, at low cost, on a temporary basis before the auctionproper, rescheduled for October 2022.
But Wispa is sceptical even the revised date will be hit.
Asked by the Herald if he could confirm timing for the full auction, new Communications Minister David Clark responded with the general: “I am confident that future spectrum allocations will be made in good time, to ensure that rural wireless services and other providers can continue their services.”