Telecom makes hay over Vodafone-TelstraClear deal ... in ye olde print


Chris Keall

Sorry for the wonky angle ... it's analogue, innit
Moutter mouth: new Telecom CEO playing things on the front foot

UPDATE Oct 31: It's been intersting to watch Telecom's response to the Vodafone-TelstraClear deal – the first major industry development of new CEO Simon Moutter's tenure (which Chris Quin now heading retail).

Mr Moutter – never a wallflower during his last stint at Telecom – has been noticeably aggressive in his comments (below). Good to see.

And Telecom was quick off the mark with an ad campaign that ran in the NZ Herald, Waikato Times, Dominion Post and in the Christchurch Press, says a Telecom rep (see image top right - the fine smaller text says: "Vodafone wants to buy TelstraClear. That might not be what you signed up for. If you'd like to have a choice about your telco, we'd love to talk").

Curiously, the campaign was all print. The only web element was a house ad on Telecom's site, and the only social media element a couple of retweets by Telecom's account when a couple of its followers mentioned the ads.

The lay observer would think a cheeky campaign like the "Now's Good" take-off would play well online* (with a link through to a Telecom Total Home package, as per the house ad version on Telecom's website), but there you go.

Still, it's good to see Mr Moutter playing things on the front foot. I suspect many an entertaining clash with Vodafone boss Russell Stanners lies ahead.

* Weekly business newspapers are, of course, a superb medium for brand advertising.


Telecom boss says he's ready to exploit Vodafone-TelstraClear merger

Oct 30: Telecom New Zealand is well poised to take advantage of any opportunities that arise from the merger of Vodafone and TelstraClear approved by the Commerce Commission this morning, CEO SImon Moutter says.

“We’ve always respected Vodafone and TelstraClear as competitors and we don’t see that changing now they’re coming together as one company,” Mr Moutter sats.

“At the same time, we know from past experience how potentially distracting significant operational change can be to an organisation and to their customers.

"We’re keen to engage with any prospective customers who may be unsettled by the Vodafone-TelstraClear merger and want choice in their telecommunications company.”

Earlier, Deutsche Bank's Geoff Zame told NBR the deal was "clearly negative" for Telecom. It made Vodafone more competitive in the corporate market against Telecom's Gen-i division, and delivered it critical mass in the retail market.

However, with the deal public since July, and no surprises in this morning's approval statement by the Commission, Telecom investors took events in stride.

The company [NZX:TEL] was up 1.68% to $2.42 in late morning trading, outpacing a broader market rise [UPDATE: it closed at $2.42].

Telecom (above) and Chorus have had mixed NZX peformance since the Vodafone-TelstraClear deal was announced July 12. It received approval today. (Source: S&P Capital IQ; click to zoom). Chorus was spun-off in November 2011.

Mr Moutter is still working on his "ambitious" and "powerful" new stratetic plan for Telecom, due to be unveiled at an unspecified time early next year - although he has already flagged that he wants to "draw a line in the sand" against eroding retail broadband share. Mobile and the UFB will be other points of focus.

The Telecom boss could face a determined challenge - with a personal edge.

"Hopefully the two combined together will have the ability to shake up the market and to challenge Telecom for the number one spot – a long-held goal of Vodafone CEO Russell Stanners," Telecommunications Users  Association head Paul Brislen told NBR this morning.

Chorus NZX peformance since the Vodafone-TelstraClear deal was announced July 12. It received approval today. (Source: S&P Capital IQ; click to zoom).

Less reliance on Chorus
Vodafone has said post-merger it wants to utilise TelstraClear's fibre backhaul network, reducing its reliance on Chorus.

Again, the statement has been in the market months and Chorus investors did not react strongly to today's confirmation of the merger.

In late morning trading, Chorus shares [NZX:CNU] were up 0.3%, in line with the broader market [UPDATE: Chorus closed down 0.89%].

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5 Comments & Questions

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and I was hoping this was restricted to banks

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Well played Telecom.

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Tedious bloody nonsense. Win customers based on actual products and services, not by pointing at the other guy and shouting about how shite they are.

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Nice work - glad to see Telecom has grown a pair and muscled up

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now which of these companies has had constant email stuff ups (including email that has simply disappeared, I know because I sent it and I never received it) since they moved to yahoo mail was it 3 years ago now?

One of these companies has a clue, one doesn't.

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