Vodafone: 5G is happening. What’s the problem, Chorus?

31 January 2018

Opinion piece - Russell Stanners, Vodafone CEO.

Today more than 98.5% of Kiwis are served by three mobile network operators, with a host of other mobile retailers competing hard to win and keep customers.

In 2015 New Zealand was ranked number one in the world for mobile data speeds, and we’re in the top ten OECD countries for mobile subscriptions per capita. When it comes to value for money, the Commerce Commission’s latest monitoring report has our pricing at between  27% to 47% below the OECD average for bundles of services.  

Leading investment, innovation, competition and great prices is what we are delivering to Kiwis today, and there is more to come. In partnership with the government through the second Rural Broadband Initiative, Vodafone, Spark and 2degrees are rolling out a shared rural 4G network that will provide coverage virtually everywhere over the next five years.   

This existing infrastructure and our ongoing investments means we are primed and ready for 5G.  Like 4G, 5G is an evolution of the network and is a straightforward upgrade that benefits from the existing infrastructure we have invested in. All three mobile operators have publicly talked about the fact that 5G is coming. It is on track to happen, without the government intervention, taxpayer subsidies and regulation which are part and parcel of the UFB model.

Why then, is Chorus floating the idea of replicating the UFB model for deploying mobile 5G technology? The most obvious commercial motive is they are looking for a short cut regulatory leg up to expand their market opportunity. In addition to being self-interested, this approach would slow down deployment of 5G in New Zealand as it will disincentivise investment and foil the race for competitive advantage.

With so many Kiwis relying on Chorus for broadband, my best advice is that the company focuses on delivering a great fibre customer experience, accelerating their own innovation and better addressing the fibre installation challenges that we hear about day in day out.  

Or maybe there is another agenda here? The fact that 4G today, and most definitely 5G tomorrow, can easily compete with fibre networks for many customer needs must be a frightening prospect for a regulated monopoly. Perhaps their game plan is simple: if you can’t beat ‘em, regulate them instead?

Vodafone: 5G is happening. What’s the problem, Chorus?