Telecom chief executive Simon Moutter yesterday announced a
name change for the group and a new television service.
Photo by Peter McIntosh.
Telecom is changing its name to Spark and later this year
will launch ShowmeTV, a new internet television business, the
company announced yesterday.
Chief executive Simon Moutter said the migration of
entertainment to the internet was creating significant
disruption to broadcast TV businesses' models and real
opportunities for new online businesses.
''The rapid growth of better broadband via fibre and VDSL
[very-high-bit-rate digital subscriber line] means watching
TV via streaming over the internet is now a much more viable
option for New Zealanders.
''We believe the time is right to enter this market and
provide New Zealanders with exciting new choices when it
comes to watching video entertainment.''
VDSL technology provides fast broadband over the existing
copper line network.
Telecom recently ended its content deal with Sky TV.
Few details were available yesterday about the content of the
new television business, but Craigs Investment Partners
broker Chris Timms said the initial content at launch of 5000
hours looked light.
Forsyth Barr broker Suzanne Kinnaird said the launch of the
new on-demand service would be expensive in terms of content
acquisition and development but it was likely to gain a
foothold in the 2015 financial year.
Mr Moutter said the name change would mark the next step in
the changes made during the past year.
As a company, Telecom had moved beyond the home telephone.
''Spark represents what we are today - it is all about
digital services, fibre, mobile, data, cloud, entertainment,
apps or whatever new technology is around the corner.''
Spark would continue to use the current Telecom logo, which
he said was generally referred to as a ''spark''.
ShowmeTV would offer New Zealanders a new choice of how to
get their home entertainment, which the company believed
represented the future of how people would access content.
''It's a great example of how this company is changing by
delivering the sorts of new services our customers want,'' he
Telecom reported a flat bottom-line profit for the six months
ended December of $167 million. However, the accounts showed
reduced revenue, operating earnings and after-tax profit.
Only the inclusion of $20 million in discontinued earnings,
net of tax, kept the profit in line with the previous
Mr Moutter said the first-half results demonstrated a pace
and level of change he believed was unparalleled in a large
New Zealand business over the past decade. Previously, Mr
Moutter was chief executive of Auckland International Airport
and before that he worked for Telecom.
''We don't intend to slow down. We will continue to address
our cost base and strengthen our organisational performance.
We will focus even harder on becoming more relevant to
customers and to modern New Zealand, particularly as we
continue our intended transition to Spark.''