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Callplus offshoot Flip launches prepay homeline, free broadband plan

A pre-pay homeline phone service offering no contracts and free broadband is being launched across New Zealand today.

Branded Flip, the network is part of the Callplus group that also owns Callplus Business and Slingshot.

It was formed last December involving Callplus CEO Mark Callander, Callplus co-founder Malcolm Dick and Callplus and Slingshot marketing manager Scott Hoogerbrug.

Mr Hoogerbrug told NBR ONLINE the trio analysed the New Zealand market and found demand for providers offering free broadband, especially to low data users.

“Slingshot is positioning itself as more high-end data usage. We are targeting people looking to save money and not get tied into contracts and use less data," he say.

"We found that 50% of New Zealand use less that 5GB a month so it’s definitely a mass market proposition.” 

Most New Zealanders pay too much for their landlines and broadband, saying at $50 a month he can beat the $70 to $75 a month offered by the competition.

Flip does not have a contract but charges a $49.95 installation fee, plus $49.95 a month for the homeline, which includes 5GB a month of broadband.

Local calls are free, and national, New Zealand mobiles and overseas landline calls to more than 90 countries are 20c a minute.

Mr Hoogerbrug says people can buy more broadband but, unlike other suppliers, the broadband can be used up to a year and doesa not expire when a fresh month rolls over.

Datablocks can be bought for $5 for 2GB, $10 for 10GB and $20 for 15GB. 

“You don’t have to worry about buying data and losing it,” he said.

A pre-pay service also means customers control their accounts better and won’t suffer “bill shock” if they use their phone too much.

Flip also sees a market in students unwilling to tie themselves to long contracts – especially when they tend to move at the end of the student year – transient city dwellers and new arrivals to New Zealand who aren’t sure where they will end up living.

In addition to no contracts, Mr Hoogerbrug says another point of difference for his company is having a huge investment in online.

Finishing touches were being made to the Flip website (www.flip.co.nz <http://www.flip.co.nz>) over the weekend in time for it going live at 8am today. Just 10 staff are employed at the Flip call centre in Auckland’s Vulcan Lane, though it can draw on support from "partners" when needed.

“Customers can manage their account online without calling us. We have integrated our support systems to handle social media , with customers using the channel they are most familiar with.

"Because we are new, we can make changes quickly and we have a big focus on feedback from customer forums,” he says.

Flip will be available to 60% of New Zealand, essentially the main centres, says Mr Hoogerbrug, but the service will gradually be extended further. Would-be customers can register with the company, with the rollout matching consumer demand.

“We have had a few people trialling the service. But we have a brand new network waiting to be filled up. We have our own equipment and exchanges thoughout New Zealand.

“For actual copper lines, we use Chorus like everyone else. Internet and calling is controlled by us.” 

Mr Hoogerbrug says to join the service, customers will need their own phones and modems. They then need to go online or use the call centre, make the first payment and the service should be working within a week.

More by Darren Greenwood

Comments and questions
40

Free broadband my Ar$e - if you do the math I'd wager that the cost of the BB bundle is built into the margin from their land line offering... what a crock

@ #1 - I think what they're getting at - is that the standard phone line rental in NZ is still $50...this plan is $49.95...so essentially, you are getting the 5GB broadband for free. They need to provide data though, given that its a VOIP POTS line.

yes I can see that but it isnt free is it. This is false advertising

If it's a VOIP POTS line, what's the quality like? and would the data used by calls be zero rated? Probably a question for FLIP ppl given this is brand new

So #1 are you going to do the math? Flip is charging $49.95 a month for the phone line and broadband and Telecom charges $41.60 - $50.23 a month for just the homeline. Sounds pretty close to free to me. Either way it's great to see more competition in the NZ market.

#4 you do the math. the customer is still paying for Broadband given the margins at play with Naked DSL

If Flip want to charge $49.95 for a Homeline, then anything they throw in on top of THAT charge is therefore free. Hence the whole marketing aspect of free broadband. Comparing the margins from naked DSL is irrelevant. Do you do this with all products you see advertised with 'free' this and 'free' that? Actually yes, you probably do. You need some more liquid in your cup, it's half empty :(

I think we need to credit more people with smarts instead of telling them to top up their cups and be treated like dummies by companies that should know better - I'd expect this from Telecom. This is clearly not free broadband. Take a look at the wholesale pricing of NDSL then take the retail pricing by FLIP off from that. Nope not free

I don't get what the big issue is. People should be happy that other telcos are popping up.
More telcos means more competition and hopefully equals what should lead to a price reduction.
So more power to Flip for stepping up and thinking about us rather then their pockets.

#5 pretty close to free in free. End of argument

Meant *isnt*

This will do very well, especially for students and short term tenancies of less than 12months.

You reckon? I don't know about you, but most students I know are voracious consumers of data and after a months use this plan are probably going to be no better off than they would be with another plan.. In short this is a complete con

YOu can add on extra data plans. Not sure on costs but depending on usage, must be less than 3 month early termination fee.

I would wager that the the costs talked about for additional data are probably too steep given the typical high usage you'd get with students

What is actually nice about this, is that Malcolm Dick (who has enough $$ to launch this all under CallPlus) is "sharing the wealth" with his management team.

Yes, and that would be genuine too. Nice guy, Malcolm

I stand by my original comment - look at the WHOLESALE rates and then the margin - the customer is still paying for broadband which in my books doesn't make it free.....

Given the amount of conjecture here, then surely those cardigan wearing freaks at the commerce commission should be investigating.. at least showing they are even handed would be a good start. If Telecom offered this they'd be being audited by com com as I was typing this. SO we have one set of rules for the incumbents and another for the competitors? I wonder how many consumers are going to get suckered in with what is a naked DSL line wrapped up in marketing hyperbole

Gee whizz, you just can't please some whinge...I mean people. Let's break everything down to semantics and all live miserable little lives. Any competitive threat to Telecom's monstruous monopoly can only be a good thing. Sheesh.

Pretty sure Vodafone got a telling off by the comcom a couple of years ago for a virtually identical promotion.

Yes they did - and I suspect Callplus will too as this is just misleading and dodgy

If it's naked DSL with Voip, then the broadband isn't 'free'.

As usual, callplus/slingshot with fradulent marketing.

I just love people slamming smaller ISP providers for trying to bring something a little bit new to the market, all you whining B******* need to find something else to bleet about or suggest a product or service that might be of value to others, instead of crying foul like a bunch of little ISP critics all chubbed up on "Ones& Zeros" 10110101000011100101 - get a life you freaks - if you dont like it, dont buy the product and "Shut the front door" - you'll know what that means . . . if you've seen the movie. Get back to it you spoons!

'smaller ISP'???
Umm, callplus is the 4th largest ISP in NZ, will be 3rd largest once Vodafone and Telstraclear merge.

spoons? dude you are so living the past. Slingsnot and callpus are the 4th largest ISP in NZ. This deal is misleading and should be investigated. Any ISP offering anything similarly misleading would cop the same flack, so focus on your own front door

I can't believe I'm seeing any negativity at all!. Shame on those (perhaps employee's of Flip's competition) to see the dark side of something that to those of standard intelligence is actually seen as a really good offer. It's innovative thinking, that historically has proven successful in New Zealand.

Provided Internet speeds are the same, which is should be as everyone is now using ADSL2, then it seems to me to be the best deal out there.

Just watch out for those sneaky guys at Telecom that charge $10.00 to keep your xtra email address, can you believe it!. Convert to Hotmail or Gmail!!!

#24 you forgot to mention that you are a Flip employee. the other players out there sdont offer such plans because they know that they'll get smacked by com com... To your other point, Most people don't ever use their ISPs email address anymore now that the free alternatives are so good

Thank you Telecom or Vodafone.... for your comments :) why would a non-biased consumer mention advertising when it's "what's on offer" that really matters to genuine consumers. I must say it seems pretty clear to me what the deal is.

If I wasn't on contract with **** then I would switch over. As for emails, do your research, there are hundreds of thousands of xtra email addresses being used.

I imagine the other ISP's don't offer that plan because it goes against their existing plans and will disrupt their customers perception. New start ups on the other can innovate however they like!.

I hope it takes off, would be great to see prices come down like mobile.

I dont work for any telcos but I can smell a rotten deal when I see one. Customers are clearly paying for broadband and if it is VoIP then what about all the other hidden costs like VoIP phones, ATA adaptors etc?

Calling something free when it is merely cheaper than most is at best disingenious and more likely a con aimed at the average consumer who doesnt know any different. Caveat emptor

Nothing false. try it first..

Pretty sure that if they offered just landline for $50, then this is indeed "free broadband when you get a landline". I don't know what you guys are moaning about, unless you see somewhere that they sell the same landline product minus broadband for like $40

So I did some research and this is what I've found out, better to look at options and know what I'm getting into before I pass judgement. Plus after reading the hearld and seeing the advert I thought I'd see for myself.

My current provider gives me 5gb (Only because they recently doubled it) & Landline $75
Landline alone is $46 in order to get cheaper international calling rates.

Another provider gives 3gb & landline $70
Landline only is $50

Then we have Flip 5gb & landline $49.95

To even it out with my current provider and the other provider to match up pricing wise, this is what I would now get.

Other provider $70 - Flip 49.95 + 15(20gb) + 5(2gb)=$70
Hmm so for the same amount I get 27gb for $70.

Current Provider $75 - Flip 49.95 + 15(20gb) + 10(10gb)=$75
Hmmm once again for the same amount i can get 35gb of data.

Sorry to say it, but looks like I'll be switching over even if I am still in contract, and looks like it is free broadband. With the other provider only I'll have to pay $50 just for a landline and no broadband. My current provider after researching will charge me $46 for just my landline and no internet if I wanted it that way $56 or there about. So its not rocket science.

Only concern I have is, because their new have all the clitches been taken care of? I would hate to not have internet, when I do need it. Mind you all companies have to start somewhere and everyone encounters issues. So don't let me down Flip.

$56 would be my landline and dialup. While around that much.

What the last thing I'd want to do is go near this, it is an insult to consumer-kind.

Come on slingshot, call it cheap, almost free but not free 'cuase it clearly isnt.

I hope you amend this dodgly piece of marketing and if not I hope you get your asses sued for misleading advertising

the point is that you ARE PAYING for broadband IT ISNT FREE to say it is is at best misleading

In a related vein, do we have a 'right' to 'free' digital tv.
It's not free if you need a new telly or set top box, is it?

every year new zealanders double their internet usage so in actuality it will suit a minority for now.

I can't see how this could be a naked DSL product with VoIP as some commenters on here are saying as you can use any exisiting modem. VoIP would work only if you plugged the existing phone into a custom modem.

I won't be holding my breath for a retraction.

I work for needanerd and have clients in the retired bracket who don't have adsl simply due to the cost. They have need for 20 - 60gb data blocks that they will never use but are still paying for. With this type of package I see a heap of potential customer ready to change.
Just hope the service is good and the switching from one Telco to next doesn't leave customers with a dead phone as I have experienced in the past