Friday, November 13, 2009

The Return Of Vodafone's Crazy Circus (Updated)

By Benedict Wee

Here we go again. A lively debate on the prices of the services and mobiles Vodafone NZ offers sprung up on Twitter and yours truly (as well as a couple of others) joined in to grill the telco about their high prices. Below are the exchanges that me and Paul have made and what I got out of the conversation.

The debate was already raging between other tweets when I logged on but I decided to only enter when Vodafone NZ made this remark:
I responded with:
Vodafone responded:
along with:
This basically meant that they don't care for PrePay users as much as they do for those who are On Account (attached to contracts). And if you're not happy about their plans: switch telcos cause you're not their target group.

I replied:

By now I know they were just bullshitting the whole situation. $29 for the Vodafone 541 is On Account and they were comparing it to a PrePay price in the UK.


First, Vodafone wanted to compare population size, which I did. After losing that battle they wanted to compare geographical size and challenged me to prove their phones were expensive:

which I did:
Again, after losing this battle they then decided to change tactics and go for their previous rediculous strategy of comparing PrePay with On Account:

Once again, they reiterated that they didn't care for PrePay customers as much. So I played their game and compared their On Account plans:

Vodafone NZ was trying to slip a quick one by comparing iPhones as Vodafone UK doesn't sell them and thus, there could be no fair comparisons. I chose the HTC Magic instead cause it was the same Vodafone branded smartphone offered in both regions.

Sensing that this battle was lost also, Vodafone attempted to change their stance with:

I responded:
The HTC Magic in the UK was free on a 24 month plan less than 6 months after it was launched. This is just them trying to coverup that fact that their phones are being sold cheaper in their overseas branches.

Even if you do not have a timeline for when the UK dropped their prices, take a look at any of Vodafone NZ's phones. None of them are free with contracts. Their attempts at justifying high prices are terribly weak and transparent.

The debate continued with them replying with the "UK is not NZ" argument they've tried to use before and after asking why is the same telco not offering a relatively similar price on their mobiles they replied that both Vodafone branches are completely separate entities that order different amounts of handsets so they're priced differently.

Vodafone stopped replying after my last message, guess they decided not to incriminate themselves anymore.

As you can see from the long exchange above, they claim that their phones are not ordered in bulk along with the head Vodafone branch for distribution throughout the world but instead, are made after the initial order which is why their phones are expensive.

Makes sense? I don't think so. Yes the phones are made by batches but they're still the same ol phones and saying that they have to pay more because of a smaller order is silly. If you owned a multinational corporation and made a product, wouldn't you order them in one big bulk and distribute them according to the market size? How do they explain that parallel importers (who are much smaller than the telcos) managed to bring in HTC Magics and sell them for $400 lesser than what Vodafone NZ asks for on PrePay?

Everything about what Vodafone NZ has said reeks of PR spinning, and a bad one at that. Proclaiming that they don't care for PrePay customers as much as they do for those On Account is a terrible statement to make considering most remain on prepaid plans do so because of the lack of value when you take up a monthly contract. I still stand by the theory that they're just exploiting the New Zealand market as they've got a strong hold over us which comes about from the lack of competition. It's about time we stand up to their tyranny and greed.


  1. I totally agree. I lived in NZ 3 years back. Back then it was just Vodafone and Telecom. Don't you guys have a new company that popped up recently? How has the price competition been since then?

  2. Yeah, 2Degrees launched a couple of months ago but they only have PrePaid services currently. Their rates are pretty good but progress is slow, some say the other two telcos are making it difficult for them to offer anything that what they've got.

    Telecom has slightly improved their rates too, they've got a promotion for unlimited texts for $12 a month to any network so that shows promise.

  3. All I can say is they are taking advantage of the local market (just like any other multi-national company would) as your Vodafone friend so kindly put it. You are definitely right... progress will take time.

    PS. Thanx for the quick reply. ;)

  4. Anytime Jasper. Here are some issues I've got regarding the ways telcos treat us, especially Vodafone.

    Taking advantage of Kiwis does have its negative consequences. The biggest problem being the unwillingness to accept new innovations because of the stigma of it being too expensive.

    It isn't too bad if the older generation sticks with their simple call/text mobile phones but if the younger generation follows suit, we'd be stuck with a country that aren't as technologically progressed as the rest of the world.

    Taking advantage of the market is one thing, but if you look at the arguments they've been making against government regulation to lower MTRs, you'll see that it's just pure greed.

    Vodafone is a global conglomerate, if they ever pulled their services out of NZ they could always rely on their other branches overseas. I think Kiwis should ask themselves how much these multi-national companies truly care about the development of New Zealand.

  5. Hello Benedict. Wow... those statements are quite to the point and dead on. I also use to have so many issues with NZ's Telcos. I seriously doubt Vodafone NZ will "change their ways" with such a profitable business "model" in NZ. (Profit and Shareholders first, CEOs second, ...., Customers last) Since they are the monopoly, there is nothing much that could be said.

    I am going to voice my 5 cents. Hope you don't mind. On a brighter note, I believe if the government were to make exemptions and stimulus into the investments of infrastructure by new mobile companies, more players may come in. This will definitely help the advances in technologies and lowering of prices.

    As you mentioned earlier in this post, this was exactly the case in the UK and also in Australia. If there is going to be "change", I believe its up to the Kiwis to voice to the government to start updating policies and give more powers to the "watchdog" for the telecommunications industry to fight for the customers' interests.

    Most people I think don't know who to complain to since they think they can't do a thing about it. I believe is helpful but they should be given more authority to enforce the policies.

    Benedict, you definitely got me thinking. Since this thread is on the happennings of the NZ telecommunications, I am happy to leave it at that. I had some good insights from your comments. Really appreciate it.

    PS Again, thanx for the extremely prompt reply. :) If you are interested in whats happenning in Australia, I'm more than happy to give you my thoughts.

  6. Hey Jasper,

    Always glad to share ideas with those who are willing to listen. :)

    Your input is always welcome here and the information you've provided is really helpful so thanks for that.

    I've been looking at Australia's mobile rates as well and the telcos there seem to have a very unique way of pricing their plans. Correct me if I'm wrong but I believe you're given a certain amount of credits per month to spend in any way you choose on voice/text/data?

    That sounds like a good way to go about though it can get a tad confusing cause from what I've read, the way they count charges (i.e to connect a call, then by minute etc.) make it kinda hard to quantify how much you're getting exactly.

    I would be interested in your opinion though. Do you find such flexibility liberating? Do you go over your allocated amount? Are you happy with the mobile subsidies?