Telecom New Zealand is a Auckland-based telephone company formed by after the privatisation of the New Zealand Post Office in 1990 and is also New Zealand's second largest mobile operator.
Telecom was formed in 1987 from a division of the New Zealand Post Office and privatised in 1990. The selling price is considered by many to be extremely low, given that Telecom had a monopoly of all phone lines in New Zealand at the time. Others consider that the capital requirements to modernise the network were better provided by private enterprise than the government.
Telecom is the largest company by value on the New Zealand Exchange (NZX) and movements in its share price have a great influence on the index of movements in the top forty companies.
History & Present
1990
- Just four years after been formed, Telecom New Zealand is sold to two United States-based telecommunications companies: Bell Atlantic and Ameritech for $NZ4,250 million. The two companies today, still have part-ownership of the company.
- Clear Communications (now known as TelstraClear , begins the first network to compete with Telecom.
1991
1992
- Telecom implements a NZ$200 million dollar fibre optic cable connection, between Australia and New Zealand.
1993
1995
- Clear Communications (now known as TelstraClear reach an agreement on local service interconnection.
1996
- Telecom establishes an telephone exchange in the United States for international traffic.
- Telstra sets up operations in the New Zealand business market.
- Telecom launches ISP, Xtra - which is still today New Zealand's largest ISP.
1997
- Saturn Communications Limited (Saturn) enters the residential phone market in Wellington after signing an interconnection agreement with Telecom.
- Telecom buys back NZ$1 million of its shares.
1998
- Ameritech sells down its 24.8% shareholding in an international public offering. Bell Atlantic issues exchangeable notes that are convertible into the Telecom shares that it owns.
- Southern Cross Cables Limited, approximately half owned by Telecom, announces plans to build a fibre optic cable linking New Zealand with Australia and North America.
- Telecom celebrates 500,000 mobile customers connected to its network.
- Vodafone New Zealand Limited buys BellSouth and enters the mobile market.
1999
- Telecom cements its future as an Australasian company by buying 78 percent of AAPT Pty (AAPT) - Australia?s third largest telco. Telecom raises its AAPT shareholding to 100 percent in December 2000.
- Telecom establishes a presence in Australia, buying into AAPT. Telstra merges New Zealand operations with Saturn to form TelstraSaturn Limited.
- Telecom launches a new nationwide payphone network using smart card technology. AAPT acquires 100 percent of Internet business connect.com.au Pty.Ltd.
- Jetstream - Telecom's fast Internet service based on ADSL technology is launched and rolled-out progressively in local exchanges.
2000
- Xtra, Telecom's ISP signs up it's 300,000th customer.
- Telecom Mobile, the mobile division of Telecom celebrates 1,000,000 customers connected to its 025 network. (The 025 network of Telecom is due to be phased out completly by 2007).
- The New Zealand Government conducts a comprehensive review of the regulatory regime. A year later it passes the Telecommunications Act, setting up a Telecommunications Commissioner. It also updates service commitments applied to Telecom, known as the Kiwi Share obligations.
2001
- TelstraClear, buys Clear Communications to form TelstraClear New Zealand , the New Zealand division of Telstra.
Effects of monopoly
The New Zealand Treasury has estimated the economic loss from Telecom's monopoly to be in the region of $50–$250 million a year. Another study commissioned in 1998 by rival company Clear (now TelstraClear ) estimated that the loss was $400 million a year.
Telecom Mobile
Telecom Moble operates AMPS, Digital D-AMPS/TDMA and CDMA mobile phone systems in New Zealand. AMPS and D-AMPS service is sold under the 025 brand and CDMA services are sold under the 027 brand. Telecom is currently encouraging their customers to migrate over to their newer 027 system. The older 025 system is set to be phased out by the end of 2007.
Customer Numbers and Market Share
The following is customer numbers and market share information for Telecom Mobile, which includes both 025 and 027 customers. Since Vodafone took over BellSouth in the late 1990's Telecom's market share has dropped every year.
| Quarter | No of Customers | Market Share % |
|---|
| December 1999 | 858,000 | 68.37% |
| December 2000 | 1,150,000 | 60.43% |
| December 2001 | 1,379,000 | 56.94% |
| December 2002 | 1,229,000 | 50.18% |
| December 2003 | 1,298,000 | 49.95% |
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