2degrees’ contribution: the $2.24 billion story so far

For Immediate Release
5 October 2011

2degrees’ contribution: the $2.24 billion story so far

Increased mobile competition, driven by 2degrees, has contributed $2.24 billion to New Zealand’s economy.

A just-released report by Venture Consulting* has quantified 2degrees’ impact on the economy, and with a “conservative estimate” it will contribute a total of $10.1 billion by 2021 through continued mobile competition.

2degrees Chief Executive Eric Hertz says since launching two years ago, it has been 2degrees’ mission to change the New Zealand mobile market for good.

“While 2degrees has grown quickly and made a significant investment in New Zealand, the wider impact of that investment has not been quantified, until now,” says Mr Hertz.

The report shows that the arrival of a third mobile entrant has generated benefits in several ways: direct investment of capital and reinvested revenues, indirect investment through support of New Zealand businesses and the wider economy, and via a “competition dividend”.

The competition dividend reflects consumer savings through lower mobile voice pricing as a result of competition – an average saving of 21% since late 2007, when 2degrees’ entry became clear to the market.

Mr Hertz says this means all mobile users have benefited because competitors have reacted to 2degrees, lowering their prices and improving offerings to compete.

“Mobile competition is off to a great start, but is still developing. We are investing in network and retail stores along with services to new markets, so we intend to do our part and continue to take the game to our competitors,” he says.

“For policy makers, it means there is something tangible to build on. Upcoming issues such as the allocation of the digital dividend spectrum will have a big impact on the future state of mobile competition.”

Mr Hertz says while 2degrees is new to the market, the struggle to provide mobile competition has been a long, tough battle.

“Our founding shareholder, Hautaki Trust, deserves special recognition for its perseverance in turning Māori spectrum into the late, third-entrant national mobile operator, serving a market that was so clearly ready for choice.”

The full report is available via the 2degrees website at www.2degreesmobile.co.nz/mobilecompetition

A few key 2degrees facts:

• 580,000 customers as at March 2011
• 200,000 New Zealanders have ported their mobile number to 2degrees
• Employs more than 500 staff from more than 30 countries
• Currently investing $100m in network to enhance performance
• Provides Pre-Pay, Pay Monthly and Mobile Broadband services to consumers and businesses
• Building a national retail store network, with more than 30 retail stores to be open by the end of the year
• New Zealand based customer care

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