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Spark doubles down on IoT, eHealth and sport content to ignite future growth

New Zealand operator Spark has launched a new three-year plan that focuses on significantly diversifying its offering.

“This strategy is about accelerating the things we know will give us a competitive edge because they respond to the trends that are shaping our market and the evolving needs of our customers,” said Spark CEO Jolie Hodson, in a statement.

Like most telcos, Spark wants to use its infrastructure – whether that be telecoms or IT – as a foundation on which it can build a portfolio of digital end-to-end services tailored to different verticals.

Its last three-year plan saw Spark take positions in the IoT, eHealth and sport markets. Now it wants to grow those positions.

In IoT, for instance, Spark’s Cat-M1 IoT network reached 98 percent population coverage in February last year; it is complemented by a LoRaWAN network.

Fuelled in part by covid-19, “we see significant opportunities for growth in IoT, as New Zealand transitions to future ways of working and pursues productivity improvements across all sectors,” Hodson said.

When it comes to eHealth, Spark has a dedicated division, Spark Health, that provides telco, IT and cloud services to hospitals and so-on. It also explores potential new use cases based on ultrafast networking, or emerging technologies like AR/VR.

“We created Spark Health several years ago and have been working in partnership with health providers across the country to provide telecommunications and cloud services,” Hodson said “The healthcare sector is now looking to accelerate this digitisation, and 5G will open up new possibilities for advanced healthcare applications in the future.”

Indeed, ABI Research said in August the pandemic has presented the perfect application scenario for the deployment of 5G networks in hospitals, doctors’ practices, and social care environments. The analyst firm expects 5G to generate around $400 million in healthcare-related revenues by 2026.

Meanwhile, in sport, Spark last spring launched its Spark Sport TV service. At first it carried slightly niche sports, like hockey, WRC rallying, European rugby etc.; however, it made a statement of intent last October when it secured a six-year deal to broadcast domestic cricket.

“We will continue to make targeted content investments that differentiate Spark [Sport] through the dual lens of customer desirability and commercial value,” Hodson said.

As well as these growth areas, Spark said it will continue to invest in its core competencies – fixed and mobile networking – and maintain its effort simplify its structure.

“Customers are looking for ‘Uber-like’ digital experiences and will move to the brands that make their lives easier, so we will accelerate our focus on delivering simple, intuitive customer experiences that ‘just work’,” Hodson said.

“Our sustained network investment will continue, with a focus on our 5G rollout and on building unconstrained capacity in wireless, which will allow us to respond to the increasing demand for data,” she added.

On that note, Spark also announced this week that it will remove data caps on its Unplan Metro fixed-wireless broadband tariff at no extra charge.

“New Zealand, like the rest of the world, continues to experience huge growth in the demand for data, which drives a 50 percent increase in traffic on our network every year,” said Spark’s technology director Mark Beder, in a statement.

“We know our customers have been wanting more data since we launched wireless broadband in 2016, and our goal over the next three years is to make uncapped wireless broadband available to as many New Zealanders as possible,” he said.

Until now, monthly usage has been capped at an admittedly generous 600 GB for Unplan Metro customers. That cap will disappear from 23 September, although there will still be a fair usage policy to stop anyone getting too carried away.

Spark’s new strategic plan also follows last month’s disclosure of its full-year fiscal 2020 results. While the growth is hardly spectacular, it is still a telco that’s moving in the right direction.

Operating revenue was up 2.5 percent year-on-year to NZ$3.62 billion, while EBITDAI edged up to NZ$1.11 billion from NZ$1.09 billion.

Spark ended the year with 2.5 million mobile connections, and 709,000 broadband connections, including 367,000 fibre connections. Based on the most recent stats from the New Zealand Commerce Commission, Spark has an estimated 40 percent share of the fixed broadband market, making it the country’s largest provider. It also leads the mobile market with a 40 percent share; second-placed Vodafone is on 37 percent.

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