Vodafone FibreX party left One NZ with $3.675m hangover

Tuesday, 22 August 2023, 8:06 pm
Article: Digitl

Vodafone FibreX party left One NZ with $3.675 million hangover

One New Zealand has received a record fine for the FibreX marketing campaign the company ran between 2016 and 2018 when it was known as Vodafone.

Last week Justice Moore handed down a $3.675 million fine following a High Court judgement.

That was the last step in a legal process that started in 2021, when Vodafone was found guilty by the District Court of misleading consumers into believing FibreX was fibre-to-the-home broadband, when it was not.

False claims

At the time it was also found guilty of falsely telling consumers that FibreX was the only available broadband service at their address. Again, this was not true.

FibreX was the rebranded name for Vodafone’s HFC cable network in parts of Wellington and Christchurch.

In 2022, the District Court fined the company $2.25 million.

The Commerce Commission, which initiated the legal action against Vodafone, appealed against the original fine. The watchdog argued the $2.25 million fine was ‘manifestly inadequate’ and said did not appropriately reflect the seriousness of the offending, and the size and financial resources of the business.

Commerce Commission chair John Small, says last week’s judgement is the highest ever handed down by a court under the Fair Trading Act.

Strong deterrent

He says it will serve as a strong deterrent to other large businesses: “…One NZ’s conduct was misleading and, in addition to the consumer harm, it distorted competition for the supply of broadband services in New Zealand”.

In handing down his judgement, Justice Moore said the higher fine was necessary “to ensure the penalty ‘stings’ from (One NZ’s) perspective” and serves as a deterrent.

He noted One NZ’s history of non-compliance with the Fair Trading Act.

Last month One NZ was embroiled in another dispute with the Commerce Commission, this time over its claim that next year it would be able to offer mobile customers 100 per cent coverage thanks to an arrangement with Elon Musk’s Starlink satellite service.

Appeal dismissed

When handing down the fine last week, the High Court also dismissed One NZ’s appeal against its conviction on nine of the original charges.

While consumers were the most obvious victims of Vodafone’s misleading FibreX campaign, it came at a key moment in New Zealand’s telecommunications history. By 2016, the nationwide UFB fibre roll-out had passed the half-way mark and companies selling fibre broadband, which included Vodafone outside its HFC network footprint, were ramping up their sales effort.

By deliberately confusing customers about the nature of FibreX, Vodafone attempted to turn customers away from UFB fibre. It would have had an impact on its rival’s broadband sales in the areas covered by FibreX.

The irony of this case is that the HFC network has since evolved to close the performance gap with UFB fibre. Today it is New Zealand’s second fastest broadband network.

Tuanz wants government to see telecoms as core utility

The election campaign kicked off for Tuanz this week with the user organisation outlining three policies it wants to see from the next government.

Top of the list is for the incoming government to start treating telecommunications as a core utility like power or water. This comes on the back of the storms and other weather events that disrupted communications earlier this year. Tuanz wants to see greater network resilience and considers this more important in rural areas.

At the same time Tuanz wants more government investment to close the gap between rural and urban telecommunications. It says government should consider socio-economic benefits in business case discussions.

A third request is the call for a “national connectivity register” linking addresses to connections to ensure help is provided to the right people.

Tuanz CEO Craig Young says: “This isn’t just about rural and remote communities. In the wake of the 2023 weather events, the need for infrastructure capable of weathering future disruptions has become evident. New Zealand anticipates continued population migration from urban to regional and rural areas, placing increased demand on connectivity. This requires faster resupply times and the implementation of more robust solutions to maintain network availability during emergencies".

One NZ reports FIFA World Cup traffic surge

Stats released by One New Zealand show the impact of the FIFA World Cup on the company’s networks and infrastructure.

The telco reports the opening match of the tournament, the New Zealand - Norway game at Eden Park, saw 112 per cent more network traffic than at the 2022 Super Rugby final. One NZ customers chewed through 400GB of data during the game.

Over the course of the tournament the company’s customers used a total of more than 1600GB of data.

One NZ says it saw the highest number of connected users at the semi-final between Sweden and Spain. At halftime, connections peaked with over 10,000 connected to the network.

Sky puts it brand on free to air channel

Sky TV has rebranded the Prime free-to-air TV channel as Sky Open. The channel will, in effect, act as a showcase for the company’s pay TV service. It would include drama, entertainment, news and sport.

Sky Open will air on Sky channel 4 and Freeview channel 15. The Prime+1 will become Sky Open+1 and be available on Sky channel 514. The channel will be available as a live stream and on demand on Sky Go, for free.

In September and October Sky Open will show 12 free-to-air games from the Rugby World Cup and regular highlight shows. Free matches include the opening match (All Blacks v France) live and the final.

Building digital connections with India

Lalita Kasanji and Sunit Prakash have set up the New Zealand Centre for Digital Connections with India. The organisation plans to help foster collaborations between New Zealand and India in the digital and technology sectors.

It’s a move that is overdue. Indians, both recent immigrants and ethnic Indians who were born or grew up here are well represented in New Zealand’s technology sectors but, as a whole, we don’t make enough of the connections they have with the subcontinent.

Given that India is the world’s fastest growing large economy at the moment, that’s a missed opportunity.

As the organisation's founders say: "Indian IT professionals, many of whom hold senior positions within the industry, have also established their own successful IT service practices in New Zealand."

Prakash says the the Centre will serve as a focal point and knowledge hub, to achieve the following objectives:

· Provide inputs to government policy and strategy through submissions and active participation in advisory groups.

· Connect businesses to new markets, enabling their success in India and New Zealand.

· Assist organisations in their diversity and inclusion initiatives in the sector.

· Ensure newcomers to New Zealand achieve their full potential in the shortest possible time.

Netflix testing streaming games on more devices

Netflix says it is now testing its streaming games service on TVs and computers. The games already run on mobile phones.

The tests have started in Canada and the UK. Netflix says it is using “limited number” subscribers which will over the coming weeks be expanded to include PCs and Macs playing games on supported browsers.

Partners for the games service include Chromecast, LG TVs and Samsung Smart TVs.

Netflix is not the first company to attempt a streaming games business - as opposed to games that need a powerful PC an Xbox or a Playstation. Google tried and failed with Stadia. Apple has its Arcade service, which is closely tied to Apple devices.

In other news…

IBM says it has developed a “brain-like chip” which could make artificial intelligence more energy efficient. It’s an important move: AI is notorious for using vast amounts of computing power, something that keeps data centres consuming energy.

A report at The Verge suggests YouTube is cleaning up its act when it comes to misinformation videos. The site has begun removing videos that discourage people from seeking professional medical help for cancer treatments and sends them instead towards quacks.

While video-conference service Zoom has softened its stance about using recorded calls to feed artificial intelligence engines, some scepticism about privacy and security issues remains.

A report at the Washington Post suggests Elon Musk is making it harder for Xusers (or Twitter users) to view content he doesn’t personally like. The technique, ‘throttling’, will be familiar to older broadband users and a few of today’s mobile data users.

The Financial Times reports prices for streaming video services in the US have risen to the point where they are now more expensive than old-style cable TV services. Sorry the FT story is behind a paywall. It says a basket of popular streaming services now costs US$87 a month, up almost 20 per cent from last year’s US$73.

© Scoop Media

Bill Bennett

Freelance journalist.

Auckland-based Bill Bennett writes technology and business stories that are directly relevant to New Zealand readers.

His emphasis is on telecommunications, but he also covers other aspects of technology and business. You can find his features in the New Zealand Herald and hear him regularly on RNZ Nine to Noon and the NZ Tech Podcast.

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