A $529 phone, bought in March, can only make 3G calls; IRD’s AI warning; Musk’s pain is Beck’s gain; a self-employed Wellington man scores a $15,760 Google Cloud refund – Tech Insider

It's not just super-budget "burner" phones, or older models, that won't be able to make calls after the 3G switch-off. Photo / Getty Creative

It’s refund week on Tech Insider, with happy endings (if lingering questions for future buyers) after a mid-price phone fell short and a cloud service caused a major bill shock. Plus: the IRD’s warning for those looking to use AI to save time on their tax return, the Trump-Musk bromance bust-up sees investors fall in love with Rocket Lab, and Uncle Sam picks up the phone to Sir Peter Beck.

$529 phone, bought in March, can only make 3G calls

Tech Insider has fielded anecdotal evidence of 3G phones still being on sale at retailers as a super-budget option, despite the fact the plug will be pulled on 3G networks by year’s end (or in the case of Spark, three months later).

But an Auckland man’s case shows it’s not just “burners” you have to be wary of.

On March 8, the man, a retired scientist, bought two Xiaomi Redmi Note 14 Pro 5G phones from PB Tech’s branch at Westfield St Lukes. The handset was on special. He paid $529 each.

The scientist – who asked not to be named; we’ll call him Jim – purposefully sought out the China-made Xiaomi. He was a fan of his current Xiaomi handset, but it could only make calls over 3G, not 4G, and he was aware that Spark, One NZ and 2degrees plan to switch off their 3G networks in just a few months’ time.

He was told the Redmi Note 14 Pro 5G would be able to make voice calls after the 3G switch-off. “I’m a very detail-orientated person, so I even got them to put it in writing,” he said.

But when he set up one of the phones, he got suspicious. There appeared to be no set-up screen for VoLTE – the 4G and 5G calling standard used by our telcos (Jim is on One NZ, but the issue would also have come up with Spark or One NZ).

This also matters for roaming. Australia switched off 3G late last year - and you need not just a minimum 4G phone but one that supports VoLTE to make your calls. It’s been a paint point across the ditch.

Jim got in touch with an industry body, which in turn put him on to no less an authority than Laurence Moss, programme manager for One NZ’s 3G Switchoff.

Moss confirmed that Jim’s Xiaomi was only making calls over 3G.

Commerce Commission general manager, fair trading, competition and credit Vanessa Horne told the Herald that selling a device without informing a consumer at the time of purchase about potential issues with the 3G shutdown could raise concerns under the Fair Trading Act (which could ultimately mean penalties for the retailer) and the Consumer Guarantees Act (which could lead to a fix at the retailer’s expense or a full refund).

The Commerce Commission has fielded 10 complaints “relating to products’ workability after the 3G shutdown”, Horne said.

Jim said PB Tech St Lukes provided him with a full refund.

But he said he was concerned the Xiaomi Redmi Note 14 Pro 5G was still for sale on PB Tech’s website – now off-special at $649 – with no mention of the 3G-only calling (the handset is also for sale via Parallel Imported and the Kogan-owned Mighty Ape and Dick Smith online stores – who also do not make any reference to the 3G-only calling).

PB Tech responds

Tech Insider asked PB Tech for comment.

The chain’s reply boiled down to: the Xiaomi does support 4G calling – just not the 4G calling standard used by Kiwi telcos.

It is talking to the mobile network operators and thinks it can get 4G calling into gear before the 3G switch-off.

“Our mobile phone product manager has confirmed that all modern Xiaomi phones have hardware that supports 4G. However, network settings with the local telcos here means that in certain conditions, the 3G band is still being utilised in some devices,” PB Tech general manager, marketing Richard Elstob said.

“As a result, Xiaomi are working with the local network operators here to make sure their software is correctly configured to ensure compatibility ... Xiaomi and 2degrees are already connected and working together on this, and we also expect Xiaomi to work with both Spark and One NZ in the months ahead to ensure their 4G software settings are compatible with the local networks here.

“As such, we don’t expect any 3G shutdown-related issues to arise for people who are using modern Xiaomi handsets purchased from PB Tech on mobile networks in New Zealand.”

A spokeswoman for Spark said all parties already had the required technical information.

“We have also provided our network settings directly to PB Tech like we have with Xiaomi, and expect that as an importer of phones they check that devices they sell are compatible with New Zealand networks.”

She added, “Spark participates in the GSMA Network Settings Exchange which makes our settings globally available to device manufacturers.”

Paul Brislen, chief executive of the Telecommunications Carriers Forum (TCF, whose members include Spark, One NZ and 2degrees) said his organisation had just sent a letters to all retailers “reiterating the need to ensure these products are fit for purpose under legislation [the Consumer Guarantees Act and the Fair Trading Act]”.

Retailers shouldn’t be selling a product with a limited lifespan, Brislen said. It was back in 2023 when the mobile network operators first announced their intention to shutter their 3G networks by the end of this year, he said.

Text 3G to 550 to see if your phone will be affected by Spark, One NZ and 2degrees shutting their 3G networks by year's end. Image / Cole Slawson

The Herald understands there are thousands of “4G” or “5G” phones on the market that are not VoLTE-compatible and so reply on 3G for voice calling.

One NZ head of sustainability and corporate affairs Nicky Preston said: “We’re working with the TCF on education for retailers and New Zealanders, because we don’t want anyone to be surprised when 3G is retired.”

Preston added: “All phones sold via One NZ retail stores are 4G- or 5G-compatible, and if anyone is unsure if their phone is going to work after our 3G network is shut down, they can text 3G to 550 to check.”

Spark and 2degrees customers can also text 3G to 550 for an instant reply telling them if their phone will have any 3G shutdown issues.

While various apps can be used for calling, only the mobile network operators’ voice calling services can be used for 111 emergency calls.

$15,760 refund after Google Cloud bill shock

Last Wednesday, Tech Insider reported on the case of self-employed Wellington man Drew Broadley, who was in a panic about paying family bills after racking up a surprise $15,760 bill during May.

The issue arose primarily from using an AI-ready (artificial intelligence) Google Cloud product, on which he ran a query he said usually cost him “tens” of dollars and which had tight parameters.

The query just kept running until his business credit card was maxed out.

Broadley went public after his initial efforts to get Google Cloud support went nowhere.

On Saturday, there was good news: he received an email from Google, saying he had been refunded $15,490.20.

Drew Broadley's refund.

While a good result, Broadley – who works as a “fractional” chief data and AI officer for hire – said there still need to be better Google Cloud safeguards.

He said the alerts were often on a 24-hour delay; that an unusual spike should trigger an intervention; and that there should be an option for a user to set a monthly billing cap.

Google New Zealand had no comment, but referred Tech Insider to comments made on LinkedIn by Google NZ’s AI/ML [machine learning] lead Nakul Gowdra, who confirmed there were budget alerts, but not budget caps.

Gowdra also linked to a Google Cloud post that read: “Users who are new to public cloud’s [sic], such as students or independent developers, will sometimes run up a large amount of costs very quickly without fully understanding why.”

Broadley – who has previous held high-level data jobs with Stats NZ and ACC and currently sits on Payments New Zealand’s Application Programming Interface Council – said Google had been in touch with him about his surprise bill. In a LinkedIn thread, others told him they had suffered similar bill shocks.

“I also got lots of ‘me, too’ messages behind the scenes,” he says.

A meeting has been set up for later this week. He hoped to get to the bottom of the cause, then post about it to stop it from happening to others.

IRD’s AI warning

The Australian Tax Office (ATO) laid down the law on AI earlier this month.

“I would caution against using AI for your tax advice,” ATO second commissioner Jeremy Hirschhorn said at the Australian Financial Review’s AI Summit.

“Whether it’s an agent or not, it’s probably only a slightly better version of the barbecue [advice] for a couple of reasons,” Hirschhorn said.

“Tax is small changes in facts that make a big difference in outputs, and so it’s very hard for an AI model to get those nuances.

“And indeed, how do you know you’re getting an Australian tax answer? If the audience is to take something from this speech, please don’t use ChatGPT for your tax advice.”

Tech Insider asked Inland Revenue (IRD) for its take. Unlike the ATO, the IRD doesn’t tell people to give AI a swerve, but it does recommend caution.

“ChatGPT is built on a type of AI called ‘generative AI’. It is a fast-growing and ever-improving field of AI. However, it can currently misinterpret queries or prompts or even ”hallucinate” – come up with answers which are not factually accurate, occasionally," the IRD said.

“We recommend that New Zealanders use AI with privacy and security in mind and to always check AI-generated answers for factual accuracy and [whether they are] fit for purpose.

“Our position is that taxpayers should only come to a final position on tax-related matters by verifying any position via information available via our official website www.ird.govt.nz or other official channels.”

Musk’s pain is Beck’s gain

Rocket Lab shares jumped 10% over the two trading days in the wake of the Donald Trump-Elon Musk bromance bust-up – which some investors obviously see opening new opportunities for Sir Peter Beck’s firm.

Rocket Lab closed today at US$29.64 for a US$13.7 billion market cap – close to its all-time high and more than double its value after an early April dip as the “Liberation Day” tariff threat dragged down the whole market.

The real-time tiff included a Truth Social post by the US President. “The easiest way to save money in our Budget, Billions and Billions of Dollars, is to terminate Elon’s Governmental Subsidies and Contracts.”

Rocket Lab founder and chief executive Sir Peter Beck in the Neutron's nose cone or "fairing".

Musk shot back on X: “In light of the President’s statement about cancellation of my government contracts, @SpaceX will begin decommissioning its Dragon spacecraft immediately” (the Dragon being the only spacecraft that can return astronauts from the International Space Station).

The SpaceX CEO later deleted that post, but other points of tension around his aerospace company persist.

On April 10, Trump had nominated a key Musk ally, e-commerce billionaire Jared Isaacman to be the new head of Nasa, one of SpaceX’s (and Rocket Lab’s) biggest customers.

But on May 31 – when the Trump-Musk rift had yet to go public – the President withdrew Isaacman’s nomination, citing donations that Issacman had made to Democrats (the Musk camp said the donations were a known factor on April 10).

And on Monday, the Washington Post reported: “Since Friday’s exchange, at least three commercial space companies, Rocket, Stoke Space, and Jeff Bezos’ Blue Origin, have been contacted by government officials about the status of their rockets and when they might be available for government missions.”

Rocket Lab’s larger, crew-capable Neutron rocket – scheduled for its first launch later this year – will go toe-to-toe with SpaceX’s mainstay Falcon9 rocket, giving Musk’s firm its first real competition in the mid-range launch market.

Blue Origin is further behind but also in the rocket business and, more keenly for Musk, also in the process of launching the first rockets for its Project Kuiper satellite broadband network that will compete head-to-head with Musk’s Starlink.

On the flipside, Rocket Lab could get a bigger slice of a smaller pie with Nasa – and especially its Mars missions, where Beck’s firm hopes to win more business – possibly to lose billions from its budget in Trump administration cuts. But Rocket Lab also has increasing defence business in the US – an area where Trump is pushing for big increases in spending.

Rocket Lab declined comment on the Trump-Musk shenanigans. Beck is as cool and measured as the SpaceX CEO is livewire.

Another issue for Musk is that many saw him relying on the Trump administration cutting red tape to clear the way for his firm’s robo-taxi trial, due to begin in Texas later this month. Tech Insider – after a recent ride in a Waymo driverless taxi in LA; watch it here – thinks Musk also has commercial problems there.

Waymo and its peers are getting more and more firmly established with their cheaper-than-Uber services. Tesla will be a Johnny-come-lately to the field and have to operate on margins to catch up.

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.