Unused data does not roll over to the next month.
But Kiwi Mobile boss Luke Blincoe touts research of 1500 people his firm commissioned that found 59% of Kiwis are paying for more data than they use. Two-thirds wanted more flexible plans.
Levelling up
Although it headlines daily prices, Kiwi Mobile actually bills in weekly, fortnightly or monthly cycles. If that 5GB proves inadequate and you use up all of your maximum-speed data, you can lump a slower speed or top up to 10GB ($1.60 a day), 20GB ($1.90), 40GB ($2.00) or 100GB ($2.10).
An app lets you level up or level down each month.
If you use up all your data within a month, you trip onto “endless data” at a slower speed.
Hard yards for virtual players
Kiwi Mobile is what’s known in the industry as a mobile virtual network operator or MNVO. That means it uses an established player’s network (in this case, 2degrees), then sells its own branded version of the service, with its own mix of plans and pricing.
You can either get a Kiwi Mobile number starting with 026, or carry across your existing mobile number.
You bring your own phone, but use a Kiwi Mobile Sim card or, if your phone supports it, e-Sim (a software-based set-up where you don’t need a physical Sim card).
In some countries – particularly the UK, where one in seven customers is on an MVNO – the model has helped juice mobile market competition.
But in its most recent Telecommunications Monitoring Report, released in June, the Commerce Commission said a half-dozen MVNO players, including mobile services offered by The Warehouse, Mercury and Kogan-owned Mighty Ape, had just 77,000 customers collectively or 1.3% of the market, down from the prior year’s 106,000 or 1.8% (the shrinkage was put down to 2degrees merging with Vocus NZ, the owner of Orcon and CallPlus, two ISPs that used to offer mobile services via an MVNO arrangement with Spark).
Can Kiwi Mobile buck the trend?
Can Kiwi Mobile succeed where other MVNOs have barely made a dent?
Blincoe says Electric Kiwi has proved its chops as an electricity retailer, with close to 4% of a market where it has to tussle with giant gentailers. He says the same straight-talking popular appeal, and flexibility via an app, will be brought to the mobile market.
Back in 2019, when he was in charge of Orcon and CallPlus, Mark Callander – now 2degees chief executive – called it “disgraceful” when the Commerce Commission decided there was no need for regulatory changes that would give more pricing freedom for MVNOs.
The regulator found the market was competitive. Callander disagreed. “We’ve been selling mobile plans through an MVNO for more than a decade now and have a grand total of 26,000 customers – and we are the largest MVNO in the country.”
“Mark is like poacher turned gamekeeper,” Blincoe jokes.
And although he won’t reveal the wholesale rates involved, citing commercial confidentiality, the Kiwi Mobile boss says his company got a good deal from 2degrees and that he doesn’t share concerns raised by others about the state of the MVNO market.
Wearing his Electric Kiwi hat, Blincoe has frequently railed at the state of the power market – including his statement last week that his firm has been forced to close its door to new customers because wholesale prices had “completely blown up”.
But he’s much more relaxed about the state of the telecommunications landscape.
“The market structure isn’t perfect but it’s significantly better, more fair and closer to a level playing field than what we’re used to,” he says.
5G, WiFi Calling
Notably, Kiwi Mobile has full access to 2degrees’ network. In the early days of 5G, MVNO customers got 4G only.
Kiwi Mobile customers also get frills such as Wi-Fi calling, which 2degrees introduced for making calls to regular cell numbers over wireless networks if no mobile coverage is available.
Hotspotting or sharing mobile data with a laptop or other device is included. Again, this has been a historical pain-point for MVNOs.
The newcomer does not offer fixed-wireless – where a mobile network delivers broadband to a home or small office as a landline replacement – but Blincoe says Kiwi Mobile could add it in future.
And while it’s running on 2degrees’ network, Blincoe says his firm owns its own technology stack for its app, plan and tech support, boosting its ability to differentiate its products.
Crowd around the $40 mark and below
To help kick things off, there’s a first-three-months-free launch promotion, and if you bring one buddy into a group plan you both get 15c off your chosen daily rate. If you rope in two buddies, the three of you get 30c off.
Direct comparisons are tricky in a market where direct comparisons are thwarted by the carriers offering different mix-and-matches of features at differing price points. But there are signs rivals are aware of incoming competition. Spark’s budget sub-brand Skinny, for example, has a temporary offering of its 10GB max-speed plan at $20 per four weeks rather than the usual $40 – at least for your first three payment cycles.
2degrees’ 5GB carryover plan is $40 per month, albeit without unlimited calls and texting (which kick in at $50).
MVNO Kogan Mobile (which uses One NZ’s network) offers deals including 4GB for $25 per month including unlimited text and calling - but with few other frills and the hook that you have to pay $250 upfront.
Blincoe’s pitch is that a Kiwi Mobile customer’s ability to shift between daily rates via the app – all within what’s framed as one plan – will prove cheaper for those who need flexibility.
No bundled power, for now
Bundling mobile and power would make Kiwi Mobile stickier, but there are no immediate plans to tie the two together. And he says the lack of bundling is not related to Electric Kiwi’s recent move to close its doors to new customers. “Our strategy to launch mobile was born well before all the wholesale [electricity] pricing grief started escalating.”
He says he’s confident Kiwi Mobile can sign “tens of thousands” of customers in its first year.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
