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Telecom New Zealand: Companies
built 237 days ago
Telecom New Zealand faced new difficulties as the new decade progressed, particularly at its AAPT subsidiary, which was struggling to hold on to a slipping subscriber base. By the end of 2002, after posting losses for its 2002 year, the company was forced to abandon its plans to impose itself as the major telecommunications group in Australia, lowering its ambitions to focus instead on that country's business sector. Adding to the company's troubles was a decision by the New Zealand telecommunications regulator to require the company to lower its interconnection rates for its competitors, a move that suggested the possibility of increased government-led rate pressures in the future.
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On 27 June 2006, Telecom New Zealand announced the setup of an independent unit that caters for its wholesale and retail customers. Later on 19 Oct 2006, the company announced the expansion of its operations into Asia and set up an office in Singapore.
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The New Zealand Commerce Commission has issued its draft determination on the price and non-price terms for access to Telecom New Zealand’s (TNZ) Unbundled Bitstream Access (UBA) services. The Commission is now seeking submissions from the telecommunications industry. The UBA service is a wholesale broadband service which allows telecommunications companies to supply a range of broadband services to retail customers. The Commission’s determinations will allow competitors to take the services from TNZ without the need for any separate commercial agreements. The Commission has set prices for a basic service, and two enhanced services, with different settings for quality of service. For a basic service, the price is NZD 27.70 per month rental with local access.
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New Zealand's Commerce Commission has been investigating complaints by customers who say that they are not receiving what Xtra promised since the same time when Xtra initiated its traffic management policy, December. Deborah Battell, fair trading director, said that the Commerce Commission is pleased Telecom is crediting customers for its error. "However, the Commission is concerned that Telecom's actions may not address the full extent of the problems. The Commission will continue its investigation into whether the promotion breached the Fair Trading Act. In particular, the Commission is considering whether Telecom's initial representation that Go Large gave customers unlimited access was misleading, as the company's reasonable use policy in effect placed limits on use."
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A deep recession in the New Zealand market, coupled with continued pricing pressures, forced Telecom New Zealand to look again at international expansion at the end of the 1990s. The company acquired a stake in Fiji Telecom, and set up a subsidiary in the Cook Islands, before turning to its larger neighbor in Australia. Leading the company's new strategy was Teresa Gattung, who took over the CEO spot in 1999 at the age of 37, becoming New Zealand's highest paid executive.
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Telecom is one of the largest companies in New Zealand and the largest component of the domestic stock exchange. The company seemingly relied on its legacy as a former state monopoly in the past, which engendered a backlash among government, business and consumers. This led to a series of regulatory and PR setbacks for the company culminating in the forced split of Telecom in hopes for more investment and faster implementation. While this is a fearsome backdrop for any company to work in, the size and importance of Telecom should prevent the politicians and bureaucrats from getting too carried away.
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