Spark NZ to launch IoT network next month

Spark NZ will be launching its low-power IoT network in mid March, along with a new digital media platform in April.
Written by Corinne Reichert, Contributor

New Zealand telecommunications carrier Spark has announced that it is aiming to launch its Internet of Things (IoT) network next month while continuing to trial its Cat-M1 network.

According to Spark, it is expecting to provide coverage through the IoT network to around 20 urban centres and key rural areas by midyear.

"We have progressed our plans in the IoT space by commencing the rollout of a low-power IoT network, suitable for when sensors or devices are transferring small amounts of data and are reliant on battery power. We have been testing this network in the industrial and agriculture markets and expect it to be commercially available in mid-March," Spark said in its financial report for the first half of FY18.

"We are also testing LTE Cat-M1 technology over our mobile network, which is ideal where sensors and devices are transferring large amounts of data regularly and real-time access to that data is critical. We believe these two networks will be complementary when it comes to meeting customer needs."

Spark additionally announced that it will be launching a new media platform and services in April, with 300,000 subscribers on its current Lightbox offering.

"Our partnerships with Spotify and Netflix continue and, together with Lightbox, remain a valuable means of customer growth and retention," the telco said.

"We are excited to announce our new video media platform will launch in April, which will expand the range of content available and add an additional revenue stream with pay-per-view movies."

For the half year, Spark announced total operating revenue of NZ$1.8 billion, up 1.6 percent.

Net earnings were down by 3.4 percent to NZ$172 million and earnings before interest, tax, depreciation, and amortisation (EBITDA) were NZ$463 million, down 1.7 percent due to Spark's current transformation program.

During the six-month period, Spark spent NZ$262 million on capex: NZ$17 million on its Converged Communications Network (CCN); NZ$14 million on international cable construction and capacity purchases on the Southern Cross cable system; NZ$64 million on IT systems, including expanding its telecommunications-as-a-service offerings for government; NZ$89 million on its mobile network; and NZ$38 million on its fibre broadband, Optical Transport Network (OTN), and carrier Ethernet expansion.

Spark brought in NZ$635 million in mobile revenue, up 8 percent, which it attributed to the "highly successful launch" of its unlimited mobile data plan. The telco had 2.44 million mobile connections as of December 31, up 3.6 percent, with 104,000 premises now on wireless broadband. It is also continuing to expand its 4.5G network across the nation.

"We've continued rolling out 4.5G across New Zealand and now have it live on 38 large sites in 30 locations," Spark chair Justine Smyth and MD Simon Moutter said.

"This technology is an enhanced version of 4G, delivering three to five times the speed and network capacity. It also helps us prepare for a 5G future by giving us a deeper understanding of the more intensive data use cases that will be made possible by 5G."

Broadband delivered NZ$341 million in revenue, down 0.9 percent, with 45 percent of its broadband customers now on fibre or wireless broadband technologies.

Spark is also increasing automation and artificial intelligence (AI) in its network to improve customer experience, with its net promoter score up by five points.

"We now have 35 bots performing automated and sometimes very complex tasks across a variety of functions, from managing security functions to proactively resolving broadband faults to synchronising fibre orders with our smaller fibre service providers," Moutter and Smyth explained.

"Decisions on where and how to automate are informed by a big data platform, which allows us to identify opportunities for greater efficiency, or to predict problems and proactively take corrective action. Automation and artificial intelligence are now materially reducing the need for human-based help, freeing up staff to focus on more rewarding, customer-focused work."

Spark saw the biggest jump in revenue for its cloud, security, and service management segment, which was up by 17.5 percent to NZ$181 million.

"Spark Digital saw strong customer demand for its cloud, security, and service management products, with customer wins in the health sector reflecting a growing demand for the benefits and flexibility that cloud-based platforms offer," the company said.

It is now looking to shift more of its business to the agile methodology of working, Moutter and Smyth added.

"Our intention has always been to scale up our use of agile, but we now see significant benefit in adopting agile across the whole organisation in the coming months to help us achieve three crucial outcomes: Putting customers at the absolute centre of our business; dramatically improving speed to market for products and services; and further energising our company culture," they said.

"We are now working through what our new operating model might look like. As a first step, we've set up three 'frontrunner tribes' focused on broadband, managed data, and digital experience -- parts of the company we consider most capable of making early changes. We will be using these early tribes to learn how best to roll agile out wider across Spark."

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