Stretch for Telecom to meet its targets

Telecom has been beefing up its wholesale broadband connection numbers for the past year by converting existing retail customers.

Most of the 14,300 customers signed up under its JetStream Partnering Programme have switched over to other internet service providers and have thus gone from being considered retail customers to wholesale customers.

The distinction is important because Telecom risks regulation if it does not meet its self-imposed targets of 250,000 broadband customers by the end of the year, a third of which must be through wholesale.

The company reported as part of its year-end results in August that it had reached 206,000 broadband connections, but only about 15 per cent of those were through wholesale. Those numbers are set to be updated tomorrow, when the company reports its quarterly results.

Under the partnering programme, customers purchased their internet access from Telecom and their other services, including email and website hosting, from other ISPs. The programme had been slated for discontinuation since November 2004 and the deadline for customers to convert had been August 2005. That had since been pushed back to October 31 and now - with about 4000 customers still left on the programme - likely until the end of the year, Telecom said.

Chris Dyhrberg, head of marketing for the wholesale group, said that in the present context of wholesale arrangements the JetStream programme was "fairly out of date".

He added that the conversion of customers was a consequence of the programme's cancellation, but not its original impetus.

"We are conscious of meeting our self-imposed targets and getting these customers on to proper wholesale plans by the end of the year certainly helps with that," he said.

Some of the JetStream programme customers have switched on to Telecom's Wholesale Broadband Service, unveiled in September. WBS closely approximates the old JetStream programme in that customers purchase their access from Telecom and their services from other ISPs.

Telecom considers WBS a wholesale product, but the Commerce Commission yesterday said it was looking into whether this service was a "bona fide wholesale arrangement". The commission maintains that a proper wholesale product is a component that can be added to by the wholesaler, whereas a resold offering - which would be considered retail - is essentially the same.

Telecom would not say how many WBS customers it had.

As for the actual services customers are switching to, some ISPs are saying they are not as good as what was offered under the old JetStream Partnering Programme.

The maximum download speed Telecom offers its wholesalers is 2 megabits per second, while the top upload speed is set at 128 kilobits per second. These speeds were significantly slower than some previous offerings, said one ISP who asked not to be named.

Some customers had been enjoying speeds up to 4Mbps down and 800Kbps up. But Dyhrberg said: "Everyone has the option of staying on their current plan."