The Magic Bus is one of two hop-on-hop-off tours that travels around the whole of the north and south islands of New Zealand. The other has been nicknamed the big green f*** truck. Wellington is one of the major cities you can jump onto this bus tour. Magic prides themselves on being the "independent travelers" choice.
If you don't already know, this is how it works: You buy a bus pass valid for a certain amount of time, in this case a year, and then you are allowed to hop-on at certain points (towns) around the country. The service just covers transport but they will arrange for accommodation if you would like (but it's up to you to pay for it).
The nice thing about this choice of transport is they take you to all the "major" sites and have a guide (the driver) to explain why that place is so great.
The good thing about Magic is the clientele tends to be a bit older, the bus service is Qualmark endorsed (meaning the buses are nice and clean) and their "recommended" choice of hostels are usually pretty quality places. They can also book you into activities and get a discount.
The bad thing about Magic can be applied generally to these types of transport. They can be over crowded (although Magic guarantees you a seat if you ring through 24 hours ahead of time), the bus driver doubles as your "tour guide" and they get kickbacks from taking you to certain "interest points" that might not be interesting at all. And they rarely go off the "beaten path" meaning you'll have to do that on your own.
Prices vary on the route you want to take. If you want to do the whole north and south it will cost NZ$923. Where as Auckland to Wellington one way is only NZ$160. They also do discounts for YHA and other hostel card holders.
It's not a bad option if you have limited amount of time, or fly into one city and out of another, or are just shy and need an excuse to meet people while traveling. They have a website that explains all the different routes and add ons. Alternatively tourist centres should have information on hand.