For the past few years, we have been responding to aCourt case brought against Vodafone NZ by the CommerceCommission about the historicmarketing from 2016 to March 2018 of our HFC service (whichuses fibre-optic and copper cabling). At that time, we weremarketing the service to customers under the brand name ofFibreX.
A fine of $2.25 million has been handed downfor this historical marketing. The Judges findings andsentence relate to the historical marketing of FibreX from2016 to March 2018. We are very disappointed with theoutcome and respectfully disagree with the Courtsdecisions.
While we would rather be focusing onproviding great service to current and future HFC customersand inviting customers to decide for themselves about theperformance of this product, the Commission has advised usthat it will appeal the fine handed down. Accordingly, wemust respond and will be appealing both the conviction andthe fine. Our appeal will set out our strong belief thatthere are several errors with the original convictiondecision and that there are aspects of the FibreX judgmentthat simply misunderstand the services we sell and are notin the best interests of consumers or futurecompetition.
Vodafone NZ has spent over $25 million onimprovements to HFC, and the service is a well-performing,price-competitive product. The March 2022 CommerceCommissions independent SamKnows broadband measurementreport noted that 100% of HFC Max plans were all able tostream 4 simultaneous UHD Netflix streams, offering anequivalent experience to Fibre to the Home plans in thisrespect.
In addition to its outstanding performance,HFC is not subject to potential input cost rises from localfibre companies, so is good value for money. As these 3rdparty fibre input costs are projected to increase, HFC isoffering customers in eligible areas real choice and theability to access a fantastic service at an excellent pricepoint.
HFC is a remarkable broadband solution,offering high-speed internet at a lower price than Fibre tothe Home with an easy installation process. As the CommerceCommission noted in its annualtelco monitoring report in March 2021, HFC was thecheapest ultra-high user plan and we think this is agreat broadband option for consumers where its available in Kapiti, Wellington and Christchurch.
We believehealthy digital infrastructure competition and maximisingcustomer choice should be welcomed, to offer New Zealandersa wider range of broadband internet access types dependingon what they value most. As this matter is now before thecourt, Vodafone NZ will not be commenting further at thistime.
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