Telecom confident in face of deregulation

Press, 31 March 1989, Page 4

Telecom confident in face of deregulation

By

CULLEN SMITH

Telecom will enter a new deregulated business environment tomorrow determined to compete on the quality of service it provides. From April 1, Telecom will lose its toll network monopoly as full deregulation takes effect in the telecommunications industry. The deregulation process began last May with Telecom customers able to provide their own telephones, facsimile machines or telexes.

Tomorrow’s final phase will allow any business group to compete with Telecom for long-distance toll business or to establish separate telephone exchanges and provide local services. Telecom has acknowledged the likelihood of such immediate competition is remote,, with a long lead time required for installing essential equipment.

But the managing director of Telecom South, Mr Lance McKechie, said he

was aware overseas organisations were interested in New Zealand and he was set to meet the challenge. “My belief is that the best way to beat any competitor is on the quality of service that we provide.” In the last 12 months, working as a fledgling State-owned enterprise, Telecom had been moving progressively towards im-

proving its image with customers.

Generally, the business community was -satisfied with the quality of service, Mr McKechie said.

“This doesn’t mean we are resting on our laurels. We know we’ve got quite a distance to go yet and we are endeavouring to concentrate on providing good service at the cheapest possible price,” he said.

Operating expenses were targeted for reduction in a bid to be competitive on pricing. Telecom plans to spend $4OO million in the next two years improving equipment in the South Island.

About 26 per cent of Telecom’s South Island customers were now served by the latest technology telephone exchanges. This was well below the national average of about 40 per cent, Mr McKechie said.

In two years, about 90 per cent of Telecom’s South Island service would be using the latest eouioment. y