2degrees Mobile has just announced that it has signed up 206,000 customers in its first six months.
CEO Eric Hertz said that a total of 53,000 people had decided to switch their 021 and 027 mobile numbers over to the 2degrees network. He said 206,000 customers were 'actively using' its service.
"Over the last six months we've exceeded initial expectations," he said.
"We've successfully brought down prepaid prices for mobile services so that for the first time people in New Zealand people are able to access a prepaid plan at prices below the OECD average."
Hertz said the 206,000 people were people who had been actively using their mobile phones during the last 30 days.
He said Telecom's average revenue from prepay customers was below $10 a week, and said this would be a concern for the telecommunications giant.
He would not share 2degrees' average revenue per customer, but said it was "significantly above" Telecom's figure. Nor would he say where 2degrees was placed in terms of average revenue customer competition with Vodafone.
"We are significantly above Telecom and we're very excited about what we are seeing."
He said 2degrees would be launching 3G services later this year.
"We're in the process of doing the activisation of that and developing the products for the launch. "
Hertz said 50,000 of the 206,000 active users had switched over from "the incumbents" - Vodafone and Telecom.
Eighty per cent of those had switched from Vodafone, he said.
"It's easier to switch from Vodafone because you can bring the same phone," he said.
He said upgrading to a 3G network was a priority, as it would bring in higher revenue customers.
Hertz said 2degrees was focused "how many devices" could be linked to its network in ten years time, rather than how many customers.
He said it was possible that ten years time a population of 5 million people could have 20 million devices linked to mobile networks, if all the different gadgets people used were taken into account.
"What we are building is the infrastructure and the systems that will enable that," he said.
Hertz said mobile use made up only a third of total telecommunication use in New Zealand - down on the global average of 50 per cent.
"I think we are going to see a shift from fixed to mobile over the next ten years," he said.
2degrees was launched to much fanfare in August last year, following an aggressive ad campaign that featured comedian Rhys Darby.
Last year 2degrees chief executive Mike Reynolds said the company had spent NZ$250 million over ten years building up its mobile network, mainly in New Zealand's main centres.
In areas not covered by the 2degrees network, users roam on Vodafone's network via an agreement reached between the two companies.
2degrees' website ran into problems in August last year. The website allows customers to order a mobile Sim cards, register a Sim cards, check billing information and change phone numbers.
However, frustrated mobile users were unable to access the website for more than a week soon after the official launch of 2degrees last year.
Hautaki, a company owned by Maori interests, holds a 13 per cent stake in 2degrees. Its interest was diluted last year after Hautaki failed to raise $20 million from Maori interests to invest in 2degrees.By Christopher Adams