Photo source: One NZ
ComCom announced on Thursday that it is filing criminal charges against One NZ regarding claims made in its advertising campaign promoting “100% mobile coverage,” which the Commission argues may have violated the Fair Trading Act.
ComCom deputy chairperson Anne Callinan expressed concerns that the prominent claims made during the campaign could potentially mislead consumers and disrupt competition within the telecommunications sector.
According to Callinan, “The claims were likely to mislead consumers because they gave an overall impression that all currently available mobile services—text messaging, voice calling, and data—would be supported and available from 2024 and that consumers would have access to instant communication from all locations in New Zealand when, in fact, that may not be the case.”
Initially, the coverage will only allow access to text messaging (SMS and MMS), with the service expected to launch in 2024, potentially as late as December 31. Users will need a direct line of sight to the sky to access this service, which means it may not be available inside buildings, vehicles, or under tree canopies.
Callinan noted that the sight-to-the sky requirement could reduce the service’s usefulness and practicality, a limitation that was not clearly communicated in the campaign.
Additionally, there will be an average delay of two minutes for sending and receiving messages, contrary to the impression of near-instantaneous communication suggested by One NZ’s advertisements.
One NZ said it would “vigorously defend” the charges.
“In April 2023, we announced a partnership with SpaceX, which we said will bring coverage to all parts of New Zealand, effectively ending mobile blackspots,” One NZ spokesperson Nicky Preston said.
“One New Zealand will vigorously defend the legal charges laid by the Commerce Commission. The charges relate to a three-month advertising campaign about a new network technology, which was approximately 18 months away from launching and was not being marketed for purchase.”
“Our language was consistent with long-standing practice of how coverage is described by the industry and the regulator in New Zealand. Other telcos globally have used similar statements, and we’re not aware of regulatory issues regarding these.”
One NZ has expressed concerns about the Commerce Commission’s approach, stating that it strongly disagrees with the grounds for this legal action.
“Before we launch commercially, we expect to have a beta testing phase with a smaller number of customers to stress-test the service even further,” the spokesperson added.