Reflections on a hellish week for Telecom and its customers
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Posted Mon 1 March 2010 @ 4:23 a.m. by Ernie Newman
The tsunami warning came as a bit of a relief yesterday. After a solid week when telecommunications was in the news in unfavourable ways, it was good to have this sector off the front page for a day at least – though a lot of people were fervently hoping that if the tsunami proved to be for real, XT would last the distance!
The week in telecommunications started on Monday with a disappointing split decision from the Commerce Commission on mobile termination rates. TUANZ said the Commission had got it wrong. Happily Minister Joyce has called for further submissions so the show is not yet over. TUANZ, most assuredly, will respond.
Then XT went down over most of the country - again. There was saturation media coverage of the events that followed including the departures of Frank Mount (Telecom) and Steve Lowe (Alcatel Lucent). Paul Reynolds may have won friends for his directness during a media conference in admitting the scale of the problem and the faults. However, the failures have been inexcusable and rightly, the print media and especially television showed him little mercy.
Then on Friday the emergency service system in Auckland failed intermittently from 3am. Thankfully there was no tragic outcome. Only 33 calls failed to get through and the callers were quickly called back. But the problem was compounded when someone, apparently, forgot to tell the police of the failure. Oh dear - in normal circumstances this would have been bad enough but coming on top of the XT debacle it got a major reaction, including the Minister quite rightly calling for an enquiry.
Unsurprisingly almost no time went by before competitors went out to capitalise on Telecom's misery by making offers to its customers - 2degrees, Vodafone and several MVNOs including TelstraClear and Call Plus. Vodafone's offer to reimburse the early disconnection fees for Telecom customers, at a price of around $1500 in many cases, illustrates clearly the magnitude of the margins in the mobile sector - as Commissioner Mazzoleni said in her dissenting opinion on the MTRs, two thirds of New Zealanders are paying some of the highest mobile prices in the OECD.
As a tumultuous week in the industry, this one almost eclipses that memorable time in May 2006 when the cycling security guy at parliament let slip the government’s plans for operational separation and LLU.
Despite the gloating of competitors, issues like those experienced with XT show the whole industry in a poor light and have an adverse effect on public confidence. Lets hope for a speedy resolution to all these issues. Telecommunications is far too intrinsic to peoples lives and businesses to let the community down like this.
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