Mobile user charges in New Zealand are amongst the highest in the world

Research and Markets has announced the addition of 2005 Telecoms, Mobile and Broadband in New Zealand to their portfolio of reports.

According to the research company, New Zealand is at the bottom of the broadband penetration list. While some progress has been made, it will take three to four years to catch up with the rest of the world. Mobile user charges are amongst the highest in the world, wholesale facilities are truly appalling and the ongoing drama of number portability continues.

The telecoms market is expected to grow by 5% from US$8.1 billion in 2004 to US$8.5 billion in 2005. The key focus of the market is rapidly shifting to broadband.

Three players, Telecom's Xtra, TelstraClear, and ihug, continue to dominate New Zealand's ISP market. The New Zealand market went through a period of rationalisation from early this decade, with a number of smaller ISPs closing down or acquired by larger players. The number of Internet users in 2004 reached 2.45 million, which represents only a 7% increase on the previous year. By late 2004, New Zealand had an estimated 900,000 Internet dial-up subscribers and 450,000 host computers. New and existing subscribers are beginning to move from dial-up to broadband as broadband prices are starting to become more competitive with entry level prices of $39.95 for 256Kb/s services.

The broadband service provider market is dominated by Telecom, with a number of players offering some resistance including ihug, TelstraClear, ICONZ and Wave Internet. Competition is mainly coming from the reselling of their Telecom's ADSL services. Since the introduction of a new flat-rate broadband plan, the uptake of new customers has increased significantly. In late 2004, there were 165,000 broadband subscribers in New Zealand, approximately 10,000 of these were cable broadband subscribers. Competition however in broadband services still remains a problem with most competitors of Telecom merely offering a re-selling of their ADSL service. The CBDs of the major centres -- Auckland, Wellington and Christchurch -- are well served by a variety of broadband technologies. However, outside of these areas services are more limited.

Wireless broadband is increasingly being seen by New Zealander's as a serious alternative to fixed broadband services, usage is increasing steadily from a low base. Wireless broadband is a niche, not a mainstream market. In areas where fixed networks are economically viable, wired will always win over wireless. Woosh Wireless is currently rolling out a national network and already provides its services in Auckland, Wellington CBD and Invercargill CBD. By late 2004, there were less than 15,000 wireless Internet users in New Zealand, and Woosh Wireless had close to 10,000 of these users.