Feeds

Kiwi telcos hungry for consolidation

Driven by fear of ultrafast broadband initiative

  • alert
  • submit to reddit

High performance access to file storage

A desperate need for consolidation in the New Zealand market is being driven by the government’s national broadband network initiatives and could see accelerated exits and/or acquisitions according to analysts Ovum.

Commenting on the speculation over takeover talks between Vodafone New Zealand and TelstraClear, Ovum’s David Kennedy told The Register “There really is a need for consolidation and the Ultra Fast Broadband initiative (UFB) will help to drive that. Migrating customers to fibre will not be easily done by small companies.”

TelstraClear recently confirmed market speculation that it was approached by, and is in discussions with, Vodafone New Zealand to explore the potential sale of TelstraClear to Vodafone New Zealand.

“Discussions are continuing and there is no certainty as to whether an agreement will be reached,” the statement said. Kennedy said that that the traditional fixed line dominance of Telecom New Zealand and mobile leadership of Vodafone had created a very fragmented market.

“It does not make a lot of sense for Vodafone or TelstraClear to be dominated by mobile or fixed,” he said.

He added that there is real indication that those talks would lead to anything substantial but suggested that it may be just as likely that Telstra would be looking at acquiring the Vodafone New Zealand asset .

“Telstra does have a significant war chest, while Vodafone doesn’t and that group is feeling financial pressure in Europe so large sums of cash are not easy to find,” he said.

While the Vodafone NZ network is worth a lot more than the Telstra Clear, and would be valued in excess of $1 billion, Telstra has a potential war chest of AUD$22 billion based on forecast NBN compensation.

Telstra Clear needs scale to improve profitability but there would be arguments that an acquisition the size of Vodafone NZ network may be better served in emerging markets such as China or elsewhere in Asia, he said.

The move comes at a time where Vodafone NZ hasd decided to shed its controversial IT offshoring efforts and according to local press is on a recruitment drive to fill 100 IT department vacancies. Vodafone Australia did not answer queries in regard to whether it was following the trend.

Vodafone NZ has also released an RFP for a lone technology partner to streamline its infrastructure support and maintenance needs.®

High performance access to file storage

More from The Register

next story
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
It may be ILLEGAL to run Heartbleed health checks – IT lawyer
Do the right thing, earn up to 10 years in clink
France bans managers from contacting workers outside business hours
«Email? Mais non ... il est plus tard que six heures du soir!»
prev story

Whitepapers

Mainstay ROI - Does application security pay?
In this whitepaper learn how you and your enterprise might benefit from better software security.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.