Trustpower builds network, prepares for mobile and wireless launches

Trustpower builds network, prepares for mobile and wireless launches

A deal with Spark will see power generator and retailer deliver new telco services

Vince Hawksworth (Trustpower)

Vince Hawksworth (Trustpower)

Credit: Supplied

Utility Trustpower's retail operation was the growth business of the company in 2019 as it builds towards bundling mobile and wireless services.

Trustpower has inked an agreement with Spark to allow it to add wireless broadband and mobile offerings to its bundle which already includes broadband and phone services.

The retail business delivered earnings of $64 million, up eight per cent while earnings from generation fell 12 per cent to $172 million.

Total company revenue was $1.03 billion, up from $946.9 million while telecommunications revenue was $87.7 million, up from $80.7 million.

For Trustpower, wireless broadband enables the supply of telco bundles to high value provincial customers and improved internet services for existing customers on poor quality copper connections, it said.

Trustpower chief executive Vince Hawksworth says the company’s strategy to bundle utilities such as power, gas, internet and phone contributed to positive retail results.

“Everything we do is centred around value creation for our customers. We place emphasis on technology and customer services aligned to Trustpower’s core business and are continually looking for new ways to expand in  competitive market,” he said. 

Trustpower now has 107,000 customers using two or more products, up seven per cent on 2018.

"Customer retention levels in our bundled customers continue to remain higher than established energy retailers and is greater than levels reported by major telcos," Hawkesworth said.

A particular focus during the year "has been on laying foundations and investing in the capacity to offer customers the high quality internet service levels they require for downloading and streaming content, including major  events and sport.

"We’ve developed a dedicated network throughout New Zealand and connectivity to Australia and the US,” said Hawksworth.

Trustpower has invested $3 to $5 million a year for the last five years to develop a nationwide network with points of presence in all the major cities and a mesh network of dedicated optical rings for high levels of redundancy.

In addition to its Sydney points of presence the company is also building two new sites in the US, all with dedicated connections.

Small scale competitors (defined as those with less than two per cent market share) will struggle to invest in the quality of service demanded by customers for an acceptable margin, the company told shareholders.

The company told shareholders continuing demand for data will ensure the transition from copper to fibre, which will continue for three to five years providing a "value led reason" for changing providers.

Bundling will be commonplace and major players were already moving away from price-led offers to value-led offers.

Quality of service will be critical and delivering online access to the Rugby World Cup will be a key challenge for all service providers.

Further out, 5G will be the next big challenge and opportunity for the industry

Trustpower’s new app, which enables online bill payment, provides faults and outages alerts and usage history, gained second place in the international Microsoft Global Partners awards.

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