Telecom says "almost all" its 500,000 broadband customers should now be able to get back online after its third outage in two days.
The company said this morning's outage - related to two faults yesterday morning and evening - had affected tens of thousands of customers at any one time.
About two-thirds of customers were unable to use broadband between 1am and 8.45am yesterday and again between 9.45pm and 11.35pm.
Telecom chief executive Simon Moutter attempted to draw a "line in the sand" under Telecom's approximate 49 per cent share of the retail broadband market in August and acted in October to dramatically raise customers' data caps in a bid to make its plans more competitive.
First NZ Capital analyst Greg Main did not expect the outages would materially affect that effort, saying people tended to forget service problems and focus on price when they decided who to buy from. But Telecom should be marketing "a top-end service at a mid-range price" and the outages would not help with that, he said.
Telecom spokesman Andrew Pirie said Telecom was considering compensation.
The faults appear to have been triggered by a software patch to one its computer servers in Auckland but affected customers from across the country.
"The Auckland server normally runs in parallel with a Christchurch based server and service was initially restored by removing the Auckland server from the system and running solely on the Christchurch server," Telecom said.
"Yesterday afternoon service resumed on both parallel servers, but last evening further problems were experienced with the Christchurch server overloading due to issues synchronising information between the two servers.
"To address this issue, the Christchurch server was taken off the system late last night, with internet traffic all going through the Auckland server."
Pirie said both servers were now back online.
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