Telecommunications

Telecom has warned it is in for a multimillion-dollar earnings hit for three years as a result of the Government's rural broadband plans confirmed yesterday.

Investors deserted Telecom yesterday, forcing the shares down to a record low of $2.18 by mid-afternoon.

The lack of mobile phone coverage from Telecom's XT network continued to frustrate thousands of people yesterday as services remained interrupted in Queenstown, Invercargill, Timaru and parts of Dunedin.

The Dunedin City Council says an ultra-fast broadband network, dedicated to advanced research in New Zealand, is "underutilised" and should be opened up to the public.

Telecom has brought forward the timing of the wholesaling of its new 3G mobile network by nearly a year.

Telecom defied the expectations of analysts by yesterday, reporting a 64,000 net increase in mobile connections on its ultra fast XT network, during the three months ended September.

The promised Telecom 3G mobile network will be available to customers from 6.30pm on May 13, along with a range of new devices that Telecom hopes will lift it above the smart phones and services being offered by competitors.

Telecom says it has no plans to abandon its public pay phones, despite the huge rise in mobile phone use in the past five years.

Vodafone said today it is launching a fixed line broadband in New Zealand that will also offer home phone lines.

Telecom New Zealand's third-quarter earnings are expected to have fallen by as much as 21% in the three months to March.