Spectrum renewal ushers in third mobile player

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Government hopes competition will drive mobile costs down

By Computerworld staff | Auckland | Thursday, 15 May, 2008

Telecom and Vodafone have renewed their cellular spectrum agreement with the government — under condition they sell of some of their 800Mhz and 900 Mhz band allocation to a third mobile player.

In fact, this has already been done, with both telcos having sold spectrum to new entrant NZ Communications. Formerly Econet Wireless, the private equity-owned company is 20% owned by the Maori-controlled Hautaki Trust.

Figures show NZ is still a pretty expensive place to make calls and the government hopes a third player will give the market a boost.

“A new mobile player will give consumers more choice and provide more competition in the market,” said Communications and IT Minister David Cunliffe in a statement today..

The two bands offer better quality and longer reach — which keeps costs down — particularly beyond the city. This will make it easier for NZ Communications to set up shop, as fewer cell sites will need to be built. The 800Mhz and 900Mhz bands can also carry the higher data-rate 4G service, described as the next step in wireless communications, allowing the government to future-proof NZ’s cellular services.

The $106 million spectrum allocation is for the next 20 years.