Telecom has announced a $10 million deal to try and retain XT mobile customers and has put network contractor Alcatel-Lucent on notice.
At a news conference in Auckland on Tuesday, chief executive Paul Reynolds apologised to customers for Telecom's broken promises over the network, saying "enough is enough".
The XT network, which began operating in May 2009, failed for the fourth time on Monday afternoon affecting customers south of Taupo. Service was restored by 6.15am the next day.
Telecom's chief transformation officer Frank Mount resigned on Tuesday after 18 months in the job. He had another six months to go under his contract.
On Monday, the New Zealand head of the company which built the network quit. Steve Lowe from Alcatel-Lucent will be replaced by Jyoti Mahurkar-Thombre, who takes up the post on 8 March.
Dr Reynolds says he is frustrated with Alcatel-Lucent and is talking with a number of other contractors overseas who service mobile networks.
"Saying sorry is not enough - it's not good enough. Actions have to speak louder than words, and here's what we're doing.
"We have made significant changes to the operational management of XT, effective immediately. I've personally put our technology partner Alcatel-Lucent on notice today and told them that enough is enough."
Compensation offer
On Monday, customers south of Taupo experienced significant interruption to voice services. SMS and data services were also affected, but to a lesser extent.
Dr Reynolds says customers affected will receive credits to their accounts if they choose to stay with Telecom XT over the next three months.
The offer amounts to 33% of a customer's monthly plan charge, including extras such as texting.
Pre-paid customers will receive a 33% bonus each time they top up.
The amount will be 50% of monthly charges for business customers.
Telecom says it recognises that customers south of Taupo are unlikely to want to sign up to longer contracts and it is ensuring its store offers are attractive.
Series of network failures
Telecom's XT network has experienced several failures to date.
The network had a major failure in mid-December and another in late January in which up to 200,000 customers south of Taupo were cut off for up to three days.
Telecom spent almost $5 million on compensation for customers most affected by the January fault, including many in the lower South Island.
The company put upgrades to the XT network on hold last week after the work triggered loss of service to customers in New Plymouth, Upper Hutt and Wairarapa on Thursday.
111 calls affected
Communications Minister Stephen Joyce says Telecom has made him aware of more than one failed 111 emergency call due to the failure of the XT mobile phone network, but he has not been given a specific number.
Mr Joyce says the main thing is for Telecom to get the system stabilised and for his officials to work with the company to make sure they have taken every step to keep the 111 calls going should the network go down again.
The minister says there is supposed to a back-up system in which 111 calls can still go through using another network and officials are seeking assurances that that is in fact the case.
Mr Joyce says he has spoken to Telecom chief executive Paul Reynolds about the XT failures, but there is little the Government can do.
"I can't add any more pressure onto Telecom than their customers have already placed on them. They will be very, very well aware that it is a competitive environment and that consumers do have choice."
Dr Reynolds says Telecom was aware of one failed 111 call from a man who tried to call during a street brawl in Christchurch on Monday. Police were alerted by calls from other members of the public and were not delayed by the network failure, he says.
Call for Government to step in
The Telecommunications Users Association (TUANZ) had said it may be time for the Government to step in over the failures, as a national economic issue.
TUANZ chief executive Ernie Newman said the country's infrastructure is being undermined and businesses disrupted by the XT failures.
Consumer New Zealand says Telecom will need to look very carefully at what it can offer to compensate customers and encourage them to stay.
