KEY POINTS:
Today New Zealand Herald online Business Chat is talking with Russell Stanners, head of New Zealand's second largest telecommunications company.
Russell works in an industry that seems to be rarely out of the news these days. Also featuring in the news a lot these days is global
warming and reducing carbon emissions.
What do you think of the Prime Minister's quest to become a carbon Neutral country and her push for businesses to be sustainable?
Will Vodafone take up the challenge? If so, how does it plan to balance sustainability with consumer prices?
I certainly think we're in 100 per cent agreement with what the prime minister wants to do.
In fact, before she came out with her speech we'd certainly come to the view locally and globally that sustainability is a very key issue for the future, so we're very much committed to do what we need to do to make sure that the planet is the place that we can live in the future.
Have you got any current initiatives?
We do a number of things all the way from a big mobile handset recycling programme.
The building we are in here in Auckland, down here in the Viaduct, has won many, many awards for its energy efficiency, its use of space and a its reduction of a whole lot of power and air conditioning and stuff like that.
We build, as you know, a very big network and part of what we do there is to make sure that everything we do to minimise the impact on the environment, to maximise the use of reusable approaches to building the network.
Do you envisage that government regulation of the telecommunications industry will lead to a decrease in the cost of broadband services? If it will, how soon can consumers expect this to happen?
I think the first point is New Zealand enjoys some of the lowest broadband prices already, measured through the OECD ranking.
But also if you compare it with our nearest neighbour, Australia, bang-for-buck New Zealand consumers get significantly more for their dollar in broadband.
The real challenge is, regulation alone doesn't reduce prices - competition does.
So for us, on the provider side, figuring out how we can deliver great value to customers, at what price.
In the competitive marketplace prices are always under pressure.
I am a broadband customer of ihug, living in Ponsonby, and my download speed sagged to 2.92 kb/per second - 1/20th of dial-up speed - at 10 am this morning. I am on a 2 Mb/per second scheme but rarely get over 1 Mb/per second and most times down about 300 kb/per second. And as I have pointed out, it regularly drops below dial-up! When do you think we will have real broadband?
I think that he's not alone. I think that it's an issue for all consumers today of broadband.
The service deliverable is variable and that's really driven by the dynamics of the underlying network - using the copper networks to deliver broadband.
When do we get real broadband? Well, that really is a question of the investment decisions ourselves and others will make to try and deliver a better quality service.
And it relates back to your earlier question - price, investment, it all adds up in terms of what the business case is.
The long answer is, I don't see any major changes soon.
We are going to see a increase in the speed that the underlying network will provide later this year - Telecom's started to roll out their ADSL2.
But that doesn't address the issue this customer has which is the variability of the speed and that's to do with the dynamics of the network, which you'd be best to talk to Telecom about their plans to address that, because we sell their service and I for one don't know how they'll do that.
But hey, the issue's known and it's up to the industry to respond with a better service.
You have recently announced a content deal with Sky TV. What will customers be getting and how does it compare with getting Sky TV services the traditional way?
I think what we've announced is the ability to watch Sky TV channels on the mobile phone so it doesn't compete or compare with the traditional method.
I still love having the Sky decoder to watch the Super 14 and things like that at home.
But what this allows you to do is download news highlights or download the highlights of the cricket or you might want to see a snippet of Desperate Housewives - I'm not sure if that's their channel particularly.
But a number of channels for $2.50 a month - you subscribe and you've got eight or nine channels. It's quite a cool little thing you do when you've got a spare moment and on your phone, is to play around with the channels to have a look at the news or the weather or the soaps.
So when is that coming in?
It's available today - you can do it right today. I was just showing some people at lunch how it all works and showed them Sky News, which is a miniature version of the ongoing Sky News broadcast that Sky has.
You acquired ihug last year - is Vodafone looking around for further New Zealand acquisition opportunities?
No I don't think we have any further plans to do any acquisitions.
Ihug's given us the capabilities we wanted. It's a great little company.
What we need to do now is, coming back to your earlier point, is work really hard on figuring out how do we deliver a "wow" experience for our customers, which per the previous comments is quite a challenge at the moment figuring out what really do people want for broadband and what can we do.
Do you support the Government's compulsory unbundling of Telecom's copper network, with the resultant loss of billions of dollars by Telecom shareholders? What if this happened to Vodafone NZ's mobile network?
Well I think we've always had a very firm position that we don't believe that regulation is the answer to what the industry needs.
Having said that, similar regulations are going through right now in the mobile sector in terms of national roaming, co-location and mobile termination rates.
They're all very similar to the fixed regulations so in a way what has happened to Telecom is actually happening in the mobile sector right now.
There's a position coming available mid-year to head up Telecom - would you be keen to take over as chief executive of Telecom?
It would be very flattering to get the call but no one's called me yet so I've got a feeling I'm not on their list of candidates.
Do you expect a change of focus from Telecom with Theresa's departure?
Well I think that they've got a change of focus anyway given the separation announcements that came out recently.
I think they're changing their business model. They're becoming more engaged with the other partners that wholesale their service, in line with what the government wants them to do.
So I think they're already changing and I'd expect the new chief executive to continue to move down that path.
As the head of a telecoms company you must get to see the latest in greatest in technology. What have you seen recently that looks like will really change the face of telecommunications in the future?
I think at its core the mobile's doing that.
The mobile is like the PC was to the IT industry - the PC fundamentally changed the IT industry.
So disruptive technology, if you like, in our industry is mobiles, it is wireless.
In terms of cool things coming out - there's lots of cool gadgets.
I was looking at one the other day which is a pair of glasses you connect into your phone that throws up a screen three feet in front of you. So it's sort of like watching your own virtual TV screen, you know, two foot by two foot sitting out three feet in front of you.
It's pretty cool stuff.
But the interesting thing when you're getting down to it though is, the technology's always amazing but it takes a long time to change customer behaviour.
Those trends take five, seven years.
For example, text - it was seven years before it became what it is today in New Zealand and people forget that.
So when we look at new trends, the technology is "wow" but it takes a long time for behaviour to shift.
Some of the exciting things now, things like mobile tv, video calling, that's taken off in a relative sense very strongly but it's going to be many years before it becomes a mass market, day-to-day occurrence for our customers.
What happens is changing people's behaviours.
