New Zealand - Country Commercial Guide
Information and Communication Technology (ICT)

This is a best prospect industry sector for this country. Includes a market overview and trade data.

Last published date: 2021-08-10

Overview

Information and Communications Technology (ICT) technology is intensively deployed throughout the New Zealand economy.  ICT, including subsectors (telecommunications, IT hardware, IT software, IT services, Internet services and wireless technologies,), is viewed by the New Zealand Government as a key tool to increase local productivity and enhance innovation.  New Zealand’s ICT sector comprises of around 7,500 organizations.  The sector is New Zealand’s third largest export at a revenue of over $8.7B a year. Most multinational brands are distributed in New Zealand. 2022 will see Microsoft open their major investment into a data hub based in Auckland New Zealand at a cost, estimate to over NZD$1.0B.

New Zealand is rich and competitive in fintech, health IT, digital and creative technologies, Auckland is also home to established manufacturers in the biotech, robotics, precision engineering and marine industries. Co-operation between the New Zealand government, banks and the tech sector has led to an environment of clustering and knowledge sharing. This support for investment and growth saw a 31 percent increase in angel investment in 2018, 25 percent increase in capital investment. New Zealand’s NZTech are the leading tech alliance association with members from government agencies to private companies and start-ups. Significant local government investment continues to go to tech start up facilities around the main three CBDs of Auckland, Wellington, and Christchurch.

Internet-accessible devices such as tablets and smartphones are increasing demand by New Zealanders for Internet access and for faster Internet speeds.  The New Zealand Government is improving broadband services via two significant investments: The Ultra-Fast Broadband Initiative and the Rural Broadband Initiative. The Ultra-Fast Broadband Initiative will bring fiber-optic technology to homes, schools, hospitals, and businesses. The Rural Broadband Initiative will deliver broadband Internet to rural communities at a cost and service level comparable with urban areas.        

The roll out of 5G has begun in Aotearoa New Zealand and will become more widespread during the second half 0f 2021. This roll out has been led by Vodafone NZ with Spark NZ (Ex NZ Telecom) announcing its investment plans shortly after. The 5G roll out sees the New Zealand Government’s Mobile Black Spot (MBS) infrastructure on track. The MBS investment is part of a bigger $270m infrastructure package announced in August 2017 that should be completed by 2022. New cell towers to manage 5G are expected throughout the country as coverage continues.

Opportunities arise and are seized continuously in an intensely competitive, very fast-paced market. The highly innovative consumer market (commercial and personal) for ICT goods and services in New Zealand is an early and enthusiastic adopter of new systems and processes. It is an ideal testbed for a range of similar markets such as Australia, Japan, Europe, and Canada.

Approximately 150,000 people in New Zealand are employed in the ICT sector.

 IT Sector Data: 2018-2021 est.

 

2018

2019

2020

2021 (Estimated)

Total Local Production

(Estimated)

155

163

154

160

Total Exports

106

115

100

112

Total Imports

1,252

1,235

1,239

1,247

Imports from the US

68

60

46

55

Total Market Size

1301

1283

1293

1295

Exchange Rates

1.41

1.45

1.42

1.42

Source: Trade Policy Information System (TPIS), Common Data Platform      Unit: USD Millions

Leading Sub-Sectors

Consumer Technology including Wearables and WiFi Connected Smart Devices                                                          
Home Automation Products and Cloud-Based Services
Cloud-Based Commercial Services including Streaming Content
Data Warehousing and Related Products & Services
Gaming and Networked Entertainment
Augmented Reality/ Virtual Reality/ Mixed Reality

Opportunities

In April 2019, Southern Cross Cable and Spark (a New Zealand telco company) announced their joint venture to provide by 2021 a new submarine internet cable to be built between New Zealand, Australia, and the United States.  The new cable, called Next will be built by Alcatel Submarine Networks at a cost of US$350 million.  Southern Cross’ monopoly on the U.S. route was broken in July 2017 when the US$445 million Hawaiki Cable between New Zealand, Australia and the U.S. went live.  Hawaiki Cable’s entry into the market provides consumers with a direct high-speed broadband connection between the United States and New Zealand creating new opportunities for American exporters of rich digital content, as well as suppliers of supporting products and services.  

Online video streaming subscription is popular in New Zealand with many consumers turning to on demand TV, away from traditional methods.  The three top sources continue to be Netflix, Disney+ and Amazon Prime.

Statistics include:

  • 75% of users in New Zealand pay for at least one streaming service
  • The market in 2021 is worth in excess USD $52m
  • By 2024 this will be in the region of USD $59m
  • 34% of the streaming community are in the 25–34-year age bracket
  • 45% of the community subscribes to Netflix 
  • Disney + entered the market in 2020 and has taken second place
  • New Zealand Ultra-Fast Broadband (UFB) programme is one of the largest and most ambitious infrastructure projects ever undertaken in New Zealand. It will see around 87% of New Zealanders, in over 390 towns and cities, able to access fibre by the end of 2022. 

Resources

Ministry of Economic Development  
Stats New Zealand
New Zealand Technology Association