Telecom mobile’s youth-oriented sub-brand, Skinny, hasn’t even been launched yet, but is already in hot water over plans to ‘SIM-lock’ handsets to make it harder for users to switch networks.
SIM-locking means a handset purchased for use with Skinny cannot be switched to another provider, unless the user pays a $30 fee.
That may seem a small charge, but with Skinny targeting low-end youth users it could be a lot of money for many of the brand’s potential customers.
Rival 2degrees has demanded action from the Commerce Commission preventing Skinny from using SIM-locking, saying the practice is anti-competitive.
"This flies in the face of the competition New Zealanders have come to expect and deserve,” 2degrees chief executive, Eric Hertz, says in a statement.
"This is a cynical move to lock in the most cost-sensitive consumers so they can’t make a choice.”
Skinny manager Paul O’Shannessey says the policy will allow Skinny to subsidise their handsets, making them more affordable. Customers will only be locked in for nine months.
A spokesperson for Telecom says there are definitely no plans for the parent brand to start SIM-locking phones.
However, Hertz has dismissed these responses as ‘insincere’.
"This is not about better handsets – improved competition is already driving down the cost of feature-rich smartphones.
"Telecom says it will not SIM-lock customers on its XT network. That’s because business customers wouldn’t stand for it, and neither should young New Zealanders."
What do you think? Is SIM-locking a clever way to make handsets more affordable, or a cunning ploy to tie users in? Post your comments below.
