The ratings on Telecom Corp. of New Zealand (TCNZ) reflect the company's very strong domestic market positions; the growing underlying demand for reliable telecommunications; TCNZ's strong free operating cash flow; and the company's commitment to a moderately conservative financial profile. These strengths are offset by the highly competitive markets; technology risks; and a rising domestic regulatory threat. The ratings on TCNZ are principally underpinned by TCNZ's very strong domestic market position as the incumbent telecommunications owner and operator in New Zealand. TCNZ currently holds 70%–95% market shares of its traditional services, 40%–45% mobile market share, and 50%–60% Internet and broadband market shares. Its large and long-standing customer base places the company in a strong position to compete in the growing
