Telecom bullish on revenue from mobile

By Nick Stride

Friday 28th September 2001

Telecom's mobile telephony revenues will pick up from next year as data traffic takes off, Telecom Mobile Mohan Jesudason said this week.

Since its launch on July 1 Telecom had signed on 25,000 customers for its "2.5G" CDMA (code division multiple access) network, Mr Jesudason said.

A large proportion of these were existing Telecom Mobile customers upgrading but the service had also attracted some new customers.

Telecom and Vodafone this week signed a text messaging interconnection agreement that will allow users of one network to send text messages to customers of the other.

Mr Jesudason said the agreement increased the potential market of people who could text message by hundreds of thousands of users.

It would be particularly useful for the "big texters" of the youth market.

Even so he said Telecom's CDMA service was targeted mainly at the residential and small-to-medium sized business market, contrasting with Vodafone's focus on the youth market.

The CDMA service is at present capable of data speeds of only 14.4 kilobytes a second.

Telecom expects next year to crank that up to a maximum 144 bytes, with a probable average of 60 to 80 bytes when large numbers of users signed up the service.

About 60% of the population now uses mobile phones and Mr Jesudason expected that to grow to 80% in three years' time.

He said the "saturation" point, at which everybody who wants a mobile will have one and voice and data traffic would stop growing, was maybe 10 years away.

Telecom's published figures on revenue per user (RPU) couldn't necessarily be compared usefully with those of other mobile providers.

In the June year total RPU fell by 27% to $36 but Telecom, unlike others, didn't include revenues from fixed line-to-mobile calls.

If they did they would add about $11 a user, and the percentage reduction would not have been so large.

Meanwhile Telecom said it wasn't making money on its Jetstream broadband ADSL (asynchronous digital subscriber line) service.

Network general manager Simon Moutter said only 21,500, or 2%, of the potential one million New Zealand customers had signed on to the service.

The level of demand contrasted with hype from politicians, Mr Moutter said.

Comments from our readers

No comments yet