BNZ's embrace opens another Ihug channel

By MICHAEL FOREMAN

The Bank of New Zealand has gone into partnership with Ihug to extend its technology and e-commerce focus, but local managers are unclear whether a plan by the bank's Australian parent to separate off its internet operations will apply here.

National Australia Bank, which owns BNZ, has confirmed a plan to split its internet and e-commerce businesses into a separate company.

The strategy, known internally as Project Nova, is expected to lead to an independently listed digital financial services company.

Asked how Project Nova would affect BNZ, the acting manager of direct retail and channel management, Steve Ulenberg, said he could not comment as it was very early days and any such plan was being discussed at a strategic planning level.

Meanwhile, in an effort to encourage more customers to go online, BNZ has offered a "first tranche" of 5500 customers a free Ihug internet connection voucher worth $80 and the opportunity to buy a discounted Ihug multimedia PC for $1399.

Unlike other Ihug discounted PC deals, BNZ customers do not have to sign up to Ihug for two years.

Mr Ulenberg said the scheme would be offered to more customers depending on the response.

BNZ is seeking to promote its internet banking service, which was launched last November and now has 12,800 registered users.

Mr Ulenberg said that internet banking service was a way of improving customer experience rather than cost-cutting.

"Any cost savings that we could make are very much a function of the volume of customers we attract and how much support at the back end is required.

"You don't just go in and find there are enormous cost savings to be made at the beginning of it."

Ihug director Tim Wood said the $80 voucher would buy one month's unlimited connection on the company's flat-rate plan, including the set-up charge, or it could be redeemed on other plans.

About 25 PCs had been sold in the first stage of the promotion to BNZ's "valued customers." As these customers were likely to own a PC already, Mr Wood expected a higher take-up in future stages.

He said the partnership was one of several channel promotions Ihug was working and had developed from an existing relationship as a user of the bank's Buy Line payment system.

Ihug also announced yesterday its Diamond Direct Access plan, which links an internet connection plan with Ihug's digital phone service. This offers a $5 discount on Ihug's $39.95 flat-rate connection if users commit to Ihug Digital Phone and pay by direct debit.