Sweet revenge: TelstraClear jumps back into bed with Vodafone

[UPDATE: TelstraClear is unable to confirm whether or not Apple's iPhone will be in the handset line up for its new Vodafone service. The telco says today: "Customers who have an iPhone, other GSM Smartphone devices or Blackberry will be able to transfer and operate those through TelstraClear’s service. TelstraClear is hoping an agreement can be reached to offer the iPhone direct to market".]

Telecom humiliated TelstraClear by blocking its 30,000 mobile customers from XT. Now, TelstraClear is leaving, taking its cellular service back to Vodafone - where a welcoming, unrestricted 3G network awaits.

Today, TelstraClear’s mobile customers use a rebadged version of Telecom’s CDMA network in a so-called mobile virtual network operator (MNVO agreement).

But "before Christmas", TelstraClear will jump MNVO ships, and start re-selling Vodafone’s more business-friendly 3G network.

"Telecom was unable to provide complete and timely access to its XT network forcing TelstraClear to look at other options," the company said in a statement this morning.

The deal fulfils a prophecy made by TelstraClear chief executive Allan Freeth during a fiery speech at TelCon10 on July 2, during which he said that his company would soon have a 3G offering (which initially reignited rumours that his company was trying to buy 2degrees, giving it a ready-made 3G network).

“TelstraClear is now in a position to compete aggressively in the mobile broadband market,” Dr Allan Freeth said today.

“Our agreement [with Vodafone] ensures TelstraClear will have total control over our plans, handset range, customer base and international roaming is assured.”

Irreconcilable differences
TelstraClear’s relationship with Telecom broke down in March (read No T-Day for Telecom’s B-list partners). At that time, Telecom confirmed to NBR that it would not offer TelstraClear (or its smaller, business-focused MNVO Digital Island) access to its pending 3G network, at that point due to launch in June.
TelstraClear would have to wait 18 long months, as Telecom wanted the commercial advantage of exclusive access to its $574 million XT network until 2011.

By contrast, Vodafone gave its own MNVOs - Black+White and Compass, soon to be joined by Callplus/Slingshot and Orcon - unfettered access to its 3G network.

Second time around
The new relationship is Vodafone and TelstraClear’s second time around.

A previous deal came unstuck in June 2007 amid a spat over TelstraClear’s short-lived effort to build its own mobile network, which foundered after the Aussie-owned telco had spend around $50 million, centred around Tauranga.

Under the new deal, Vodafone will provide TelstraClear with bulk minutes and data, which it will be able to resell under its own series of plans. Vodafone MVNOs can resell any handsets in the telco’s line-up.

Roaming was limited under the Telecom deal. From October, TelstraClear’s mobile customers will get more seamless travel, but with an ironic twist: when they’re in Australia, they will roam on Vodafone’s network, not that of Telecom’s transtasman roaming partner, Telstra.

TelstraClear customer will have to buy a 3G handset to switch on to the Vodafone network. Until they do, TelstraClear will keep supporting them on CDMA "for the foreseeable future".