Australian mobile virtual network operator (MVNO) Kogan Mobile has launched in New Zealand. The service will use the Vodafone network and has been pitched as Vodafone’s budget alternative to 2degrees and Spark’s Skinny operation.

While the brand is unknown here, Kogan has been an Australian MVNO player since 2013. It claims a 2 percent market share in that country.

Kogan picked up the Dick Smith brand and web address when the electronics retail chain collapsed. Today it uses the brand to sell online to New Zealanders.

While MVNO is big overseas, it has failed to take off in New Zealand. Vocus’s Callplus brand and The Warehouse are among those who offer MVNO services, but they remain relatively unknown and have a tiny market share.

When Simon Bridges was communications minister he asked the Commerce Commission to investigate the mobile sector. He wanted to know why MVNOs were such a small part of the market here.

The Commerce Commission found the mobile market is competitive enough without an active MNVO sector and decided not to take action. Even so, a high profile new entrant will take some regulatory pressure off Vodafone and the mobile sector.

Much of the media attention given to the Kogan launch focused on its prices compared to other low cost operators. Vodafone chief executive Jason Paris described Kogan as the mobile Pak’n Save.

Prices are low, but to get the real savings customers have to commit and pay in advance for a year’s service. The headline price is $708 for a year of unlimited calls and texts in both New Zealand and Australia together with 1.5GB of data every 30 days. Customers who sign before the end of next month can pay only $425 for their first year.

Overall prices are competitive, but not significantly lower than elsewhere. There’s no support call centre, instead Kogan will deal with customers online.

Vodafone says it hasn’t decided if Kogan will be able to use the 5G network that will start operating in December.