Old-school Telecom payphones in central Auckland in 2004. Photo / Getty
Those services would have been funded through digital advertising on the booths, and that was the sticking point.
Sources on both sides of the debate previously confirmed the council wanted its share of a return from the proposed advertising.
The council views footpaths as highly valuable public property, whereas Spark doesn’t receive government funding for payphones and considered the council’s position a project-killer.
Without a deal in Auckland, a nationwide rollout of new booths – expected to cost around $50 million – was not commercially viable, Spark said today.
“We recognise that phone booths can be an important lifeline for some of New Zealand’s most vulnerable people, particularly those without reliable access to a mobile phone or internet connection,” Spark chief corporate affairs officer Leela Ashford said.
“They are often used to contact essential services, including social development agencies, banks and emergency services.
“While we are disappointed that we have not found a way to proceed with our proposed investment, we remain open to revisiting the modernisation proposal if circumstances change in the future.”
Auckland Council general counsel Meredith Webb said today the council had made “no decision to stop or block Spark’s proposal”.
She said the council had met with Spark on multiple occasions, but no formal application for new booths was ever made.
“An application is required because commercial digital billboards on public footpaths sit outside the infrastructure that can be installed in the road corridor under the Telecommunications Act.
“As with any proposal to place commercial billboards in the road corridor, Spark needs to follow an approval process, which manages competing uses in this public space, and which protects the public interest.
“If Spark wishes to progress the proposal any further, the council remains open to further discussions and guidance.”
Earlier, Spark said it was aware of relevant bylaws that governed digital screens, and it was happy to comply with those.
“In Auckland, the installation of phone booths with digital screens of the type and specification we are proposing is a permitted activity under the Auckland Unitary Plan and we have already applied for and obtained certificates at over 50 sites,” Ashford said in a statement in June.
“We have engaged in discussions with council and AT on the significant public value that upgrading our phone booths will have.
“We have not proceeded with formal applications, because in these discussions it was made clear to Spark that our proposed activity would be subject to rent-like charges, which we believe are not permitted under the Telecommunications Act.
“Given the significant upfront capital investment required and the ongoing cost of free connectivity and maintenance [which would be borne solely by Spark and our out-of-home partner], this requirement would make the project commercially unviable.
“This is why we have sought clarification on the act, rather than continuing to proceed with applications in Auckland.”
The removal of phone booths
Spark said modernised phone booths with advertising operated in cities including London and New York. In Australia, around 25 million calls were made each year from phone booths, including around 300,000 emergency calls.
As Chorus retired the copper network, Spark said today it was now working with councils to “safely and responsibly remove existing phone booths”.
Spark also said today it had stopped selling and reordering phone cards.
Spark said in June that telephone booths had always had a funding mechanism – people paying for calls with coins or cards – and that the Telecommunications Act prohibited councils and roading authorities from imposing any rent-style charges on booths.
Spark considered that this applied to charges through commercial licences or revenue-sharing arrangements.
But the council said at the time: “Auckland Council considers that commercial digital billboards on public footpaths fall outside the infrastructure that can be installed in the road corridor under the Telecommunications Act.”
Why do we even need phone booths?
One of Arrowtown’s (still functioning) red telephone boxes.
As Media Insider reported back in June, many readers would undoubtedly be asking: do we even need phone booths, given most Kiwis now have mobile phones?
Payphones have featured on New Zealand streets since 1910 and have been operated for the past 40 years by Spark/Telecom.
Big international cities such as London, New York and Sydney have all modernised their public phone booths, and Spark said they were used far more than people might expect.
In an earlier statement, Ashford said the existing booths had reached the end of their life.
The network is loss-making.
“As copper is retired, the booths will be disconnected and removed unless there’s a viable way to replace them with a modernised version, connected with fibre,” she said.
“Spark isn’t required to operate phone booths, and we don’t receive government funding to do so, but we still see value in public connectivity – particularly for vulnerable communities and for access to social and emergency services.”
Spark chief brand and corporate affairs officer Leela Ashford.
Spark has proposed replacing the old booths with a smaller number of modern booths – about 400 nationwide (including about 150 in Auckland) – through a joint investment with outdoor digital advertising firm oOhmedia.
“Digital advertising would fund the initial capital investment and ongoing operation of the booths and would enable free calling and Wi-Fi for the public, as well as better resilience in emergencies, with some satellite‑enabled,” Ashford said.
An artist’s impression of a new phone booth.
Councils, she said, would also get free space for public messaging, including during Civil Defence emergencies.
“The programme is on hold because we haven’t been able to reach [an] agreement in Auckland,” Ashford said.
“Auckland matters because without it, the national rollout isn’t financially viable, and that means communities across the rest of the country miss out too.”
Auckland Mayor Wayne Brown said earlier this year that he was aware of the issue. “It’s an effort by Spark to use our land to put their advertising on – and make money. Whereas it’s our land and we’re saying, ‘no, you’ve got to pay us to be there’.”
Auckland Mayor Wayne Brown. Photo / Alex Burton
In an earlier statement, council group strategy and CE office director Max Hardy said council staff had engaged with Spark on a proposal to modernise telephone booths, “which included the installation of commercial digital billboards on public footpaths”.
“The council provided guidance on how proposals of this kind could be progressed.”
Another factor that’s likely been in the mix is that the council, through Auckland Transport, already has a lucrative outdoor advertising contract for bus shelters and buses.
That contract is run by QMS, a commercial rival of oOhmedia.
In June, Hardy said the council had been “open to innovative proposals that make good use of public space and deliver benefits for Aucklanders”.
“Public space is valuable and in high demand, and we aim to balance different uses while continuing to look for better and more creative ways to use it.”
In general terms, he said, the council considered that those wanting to place commercial billboards in the road corridor should follow an approval process that managed competing uses in those spaces and protected the public interest.
Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.