Competition in NZ mobile sector improving

Competition and quality within New Zealand’s mobile market is improving, but the nation is still lagging behind Australia and other markets in areas including data pricing, according to the nation’s Commerce Commission.

The regulator’s latest study into New Zealand’s mobile market found that the nation’s three established mobile operators are performing well in key competition indicators including service quality, pricing, coverage and choice.

According to Telecommunications Commissioner Dr Stephen Gale,Spark, Vodafone New Zealand and 2degrees are all performing well on most measures of quality.

“According to Opensignal, New Zealand currently ranks eighth out of 88 countries for 4G speed. Further, mobile service prices are generally lower than OECD averages, and consumers tell us they find it easy to compare plans and switch providers,” he said.

“However, there is room for improvement in some areas. Prices for large data plans are noticeably higher than Australia and while mobile data use grew 69% last year, reliable 4G coverage is not so widespread. Information on performance measures like call dropping rates and coverage gaps is also hard to find.”

Based on feedback from consumers during the study, the Commerce Commission has commenced an investigation into the inertia that prevents mobile subscribers from more frequently switching providers.

Other insights from the study include challenges surrounding the allocation of spectrum — including potential imbalances in spectrum holdings between companies — as well as the emergence of a competitive market for network providers to sell wholesale services to mobile virtual network operators (MVNOs).

“We see no need to regulate at this stage but will keep an eye on the ability of new ‘virtual’ operators to access wholesale services. We expect more spectrum and consumer engagement will help this market to develop where it is commercially viable,” Dr Gale commented.

“Overall the study found that consumers are more satisfied with mobile than with fixed line services, but there is still room to improve. We will continue to focus on consumers as part of our telco retail service quality work.”

Image credit: ©iStockphoto.com/Oleksiy Mark

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