Telecom NZ forced to 3G by Vodafone

Telecom New Zealand was forced to make its $574 million investment in a 3G mobile network because Vodafone was eating its lunch according to Rod McGeoch, a director of the Kiwi telco.

Rod McGeoch
(Credit: Telecom NZ)

McGeoch, who had introduced Karim Temsamani, Google Australian New Zealand managing director and speaker at a Trans-Tasman Business Circle lunch today, said that Temsamani's speech outlining the people's appetite for broadband had brought to mind the $574 investment in a 3G network that Telecom NZ had announced this week.

"The reason we're doing that is that Vodafone has a 3G mobile network and are eating our lunch and we just have to respond, we're going to respond with a better spectrum and a better technology and we've announced yesterday we think we'll get a year in front of them," he told the audience.

It's now "all about" broadband over mobile networks, McGeoch said, mentioning Telstra's 12 per cent increase in mobile revenues in the last financial year to 30 June "in an industry that nobody has an increased revenue, I promise you".

He said Telstra's roll out was the best in the world at the moment and had been an enormous success.

While Vodafone eating its lunch had caused Telecom NZ to move into 3G, Google doing the same thing had caused the company to offload its Yellow Pages directories business last year.

McGeoch said the company had decided to sell Yellow Pages because, in the board's view, internet search engines were going to take over the Yellow Pages in time and "we should sell it before anybody knows".

"We did it because this man's [Temsamani's] business was on the move and was going to eat our lunch," McGeoch said.