Having completed his long journey from offices hard-by St Paul’s Cathedral in London to Telecoms New Zealand’s (TNZ) HQ in Auckland, the carrier’s new CEO, Paul Reynolds, has been inducted into the company and appointed to the board.

Mr. Reynolds immediately outlined plans to consult widely on ongoing challenges and take what he calls “the most sensible path forward for shareholders and customers.”
 
While the new CEO’s rhetoric echoes that of Australia’s Telstra, TNZ’s rival across the Tasman sea, the fact is that Paul Reynolds is leading his company in a very different direction to Telstra.

TNZ claims to be embracing regulatory change and to be well underway with newly-mandated separation requirements, while Telstra remains locked in a pitched battle  with the Australian government and has threatened legal challenges to any attempt to enforce the company to split.
 
Mr. Reynolds, who has joined TNZ after leading the separation of BT in the UK, says acceding to government makes sense for the benefit of shareholders, customers and staff.

This principle is a simple yet powerful one. It makes sense,” Mr. Reynolds said at the TNZ annual general meeting in held in the South Island city of Dunedin.

He continued, Though the largest player on the New Zealand telecommunications scene, Telecom is no longer a monopoly and hasn’t been for some time. The final form of operational separation, in combination with other regulatory decisions, will accelerate that process.”
 
TNZ chairman, Wayne Boyd, has outlined five key projects the company must address concur-rently: unbundled local loop and wholesale broadband regulation, operational separation, next-generation network deployment, PSTN voice replacement and WCDMA network upgrade.

Yesterday, he called the appointment of Paul Reynolds to the post of CEO “a watershed” for the company. Mr. Boyd went on to confirm that a workable separation model” should be agreed with the New Zealand government by year-end and that the strategy will be ready for implementation next March.

Although TNZ board members and senior executives were widely reported to have been opposed to any plans for separation, Mr. Boyd insists they are now all fully behind the plans and ready, willing and able to embrace change.
 
He said, Change is a way of life in the telecommunications industry, where the regulatory, consumer and technology currents all move rapidly. Change means new challenges and lots of opportunities. There is now industry-wide acknowledgment that we have engaged openly and showed integrity in our dealings with industry and our wholesale customers.”

Paul Reynolds played a major part in guiding TNZ’s negotiations with the government prior to his arrival in New Zealand and says he will now extend conversation with stakeholders.
I’ll be looking better to understand the character of that debate as it applies here, and assess Telecom’s part in it. If you can do it, getting things right first time every time is ultimately a good way to run a company.”

The New Zealand government has directed that TNZ be separated into three units: network, wholesale and retail. The carrier has already established a separate wholesale entity and is increasing the scale of its Gen-I enterprise business as well as investing in Australia.

Wayne Boyd says,While we now comprise a number of businesses we are a sustainable entity and one that is focussed on delivering greater shareholder value and focussed on meeting customers needs.”

Paul Reynolds has also revealed that he plans to look closely at what’s happening in Australia where TNZ is currently monitoring the integration of AAPT and PowerTel and examining opportunities to grow in the wholesale market. Last week PowerTel announced a major new wholesale supply deal with Macquarie Telecom, thus effectively taking away from Telstra as much as A$100 million in potential annual revenues.

According to Mr. Reynolds, We have a strong team over there [in Australia] and we’re anticipating benefits from the integration of PowerTel and AAPT.”

He added, I’ll be trying to meet as many of our customers, shareholders and other stakeholders as possible, here and in Australia. While I will be based in Auckland, I intend to roam far and wide.”

Asked about his move from the UK, Pail Reynolds said strong pull factors” had drawn him to TNZ. The company’s shareholders yesterday approved his remuneration package, that includes a NZ$1.75 million salary and NZ$1.75 million annual performance-based cash and share package. Up to NZ$1.75 million of rights shares will also be paid contingent on company long-term performance.

Company chairman, Wayne Boyd, says management will establish measures for the annual performance-based package within the next 60 days. These could include EBITDA and strategic targets. The long-term remuneration agreement is based on TNZ’s performance against a group of 20 global telecom companies. It requires TNZ to be above the 50th percentile of them.

Wireless Mobile Telecom Wireless News