New Zealand Telecom and Pay-TV Market Outlook: Marginal Growth Despite Mobile Voice Decline

The telecommunications and pay-TV services industry in New Zealand is expected to witness a modest compound annual growth rate (CAGR) of 0.7 percent from 2023 to 2028, GlobalData said.
New Zealand telecom and pay-TV services revenueThe marginal growth telecommunications and pay-TV services industry in New Zealand is hindered by a continual drop in mobile voice service revenue, even though mobile data and fixed broadband segments show substantial revenue expansion.

GlobalData’s recently released New Zealand Telecom Operators Country Intelligence Report highlights a projected -2.7 percent CAGR decline in mobile voice service revenue over the forecast period. This aligns with the consistent decrease in mobile voice service Average Revenue Per User (ARPU) in New Zealand, as consumers increasingly embrace internet-based communication methods and operators bundle free voice minutes with unlimited plans.

Contrastingly, mobile data service revenue in New Zealand is anticipated to experience a positive CAGR of 4.2 percent, driven by the ongoing surge in mobile internet subscriptions and the growing adoption of high-ARPU yielding 5G services.

Aasif Iqbal, Telecom Analyst at GlobalData, observes, “4G services dominated the New Zealand mobile subscriptions landscape in 2023. However, the forecast predicts a significant decline in the share of 4G subscriptions due to subscriber migration to 5G networks.”

By 2028, 5G in New Zealand is expected to represent 32.2 percent of the market share, propelled by the extensive availability of 5G services, facilitated by telecom companies’ emphasis on 5G network expansions and service enhancements.

For instance, Spark New Zealand aims to achieve 90 percent 5G network coverage across the country’s population by 2023.

In the fixed communication services segment, fixed broadband service revenue in New Zealand is projected to grow at a CAGR of 2.1 percent from 2023 to 2028. This growth is attributed to the increasing adoption of Fiber to the Home (FTTH) and fixed wireless subscriptions by customers, driven by efforts from the government and operators to enhance broadband connectivity. Conversely, fixed voice service revenue in New Zealand is expected to marginally decline during the forecast period.

The rising demand for high-speed broadband connectivity and the widespread availability of FTTH services will bolster the adoption of fiber broadband services.

For example, Chorus, a wholesale fixed-line provider, has increased its fiber lines from 959,000 to 1,031,000 in 2023. Chorus plans to retire its copper network by 2033, transitioning into an all-fiber company.

Pay-TV services revenues in New Zealand are projected to decline at a negative CAGR of 5.7 percent from 2023 to 2028. This decline aligns with the continued decrease in Direct-to-Home (DTH) subscriptions, as consumers increasingly shift to Over-The-Top (OTT) video platforms such as Netflix, resulting in a drop in pay-TV Average Revenue Per User (ARPU) levels.

One New Zealand (formerly Vodafone) led the mobile services market in 2023 in New Zealand and is expected to maintain its top position throughout the forecast period. The operator’s focus on mobile network developments and plans to cover up to 60 percent of the geographic area with Narrowband Internet of Things (NB-IoT) network by 2024 contribute to its continued leadership.

In the fixed broadband services market, Spark is the leader in New Zealand and is anticipated to retain its position through 2028, supported by a robust presence in the FTTH segment.

Sky, operating in the DTH segment, stands as the sole player in the pay-TV services market in New Zealand. The operator continues to offer diverse pay-TV packages catering to various subscriber demands, including content for kids and families, entertainment, sports, and movies for its users across New Zealand.