2degrees claims 206,000 active mobile customers

Majority of switchers are from Vodafone

Mobile challenger 2degrees, which has been operating for nearly six months, provided its first significant market update today.

2degrees is now claiming that 206,000 people are actively using its service in New Zealand by the end of January, well ahead of expectations. Hertz says the company's targets have now been increased.

CEO Eric Hertz says 50,000 of these customers have come over from other carriers, 80 percent of those from Vodafone, which uses compatible phones. Telecom CDMA customers need to change phones to migrate.

He says the success proved the idea that New Zealand was a competitive market before 2degrees launched was a myth. A second myth, he said, was that New Zealand was too small for more than two players.

Hertz says competitive pricing, quality and innovative ways to use phones are behind the success.

2degrees briefed the market today shortly after Telecom's second quarter results announcement in Auckland. Telecom claimed 60,000 net additions in the quarter for its 3G XT network, 57 percent postpaid and 47 percent prepaid.

Telecom CEO Paul Reynolds says XT had a total of 467,000 connections by the end of 2009.

Hertz says the way carriers count their users is variable and working out real market shares is a “challenge” for journalists and analysts.