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Telstra’s act of desperation

4 minute read

The Telco giants advertising campaign kicked off on the weekend with its sights aimed directly at the ACCC. In my humble opinion this is a pathetic campaign aimed at keeping its monopoly as Australia pay amazingly high fees for its fixed line services and on the whole have a terrible broadband infrastructure and the customer service from my standpoint has been terrible.

If the Federal Government brings out its plan for broadband in Australia and it solely involves Telstra and not an open network it will be a disgrace for the businesses and consumers of this country. Telstra can tell us all they like about wanting to do this for Australia, but on the other hand tell us if they do not get what they want then they will invest elsewhere – that’s the spirit!

They also call the ACCC a rogue body. Well here is my message. The Australian people have had to put up with ridiculous charges, low download caps, slow broadand speeds and their competitors in the past have had to pay more for access than Bigpond charges and the ONLY organisation that has kept some of these things in line has been the ACCC.

Telstra think that because so many Australians are investors that they will want the Telco to make more money. I can tell you that if Telstra actually had competition the majority of shareholders would have more money in their pockets through savings in their phone and broadband bills than they would ever make in dividends from being shareholders.

Example (Me): I pay around $8,000 per annum in fixed line telephone and broadband. If you look at the US market and we added 20% to the bill after exchange rates, I would be able to have ADSL2+ broadband and all of my local and national calls for around $1,500 per annum. In the US you get all local, national and calls to Canada for USD $25 per month, you can also get unlimited ADSL2+ broadband in most capital cities for $50 USD per month.

Telephone charges here in Australia are a joke and the only thing that will break this is an open fibre to the node network. Because Telstra own the last mile (from the exchange to the homes) it will then try to increase these fees. But with WiMAx just around the corner and wireless to become ubiquitous over the next ten years we will see the end of this monopoly and they can just play like the rest of businesses in Australia.

I for one would like to see how Telstra fare once they really have to compete, because since being privatised they have had it mostly their own way. The only reason Telstra are doing all of this is because they know they cannot continue making money from fixed line (although they will string it out as long as they possibly can) and they know that owning broadband networks will allow them to continually sail into the sunset with massive profits.

I will be watching just what this government does in relation to their plan to be released soon. They have two problems, one Labor’s plan which is what we need and two backlash from shareholders if they make it hard for Telstra.

My bet? The government will cave in to Telstra and then try to make it look like a brilliant plan for Australians. Unfortunately for them they are dealing with a far more intelligent consumer than even 4 years ago and the Labor party and the G9 will pool together resources (their own ad campaign) and make things even tougher, but it will be fun to see who can lie the best!

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8 Comments

  • John Dedes
    Posted May 16, 2007 at 9:10 am 0Likes

    Watched it on TV last night.

    Interesting.

    JD

  • Dave Platter
    Posted May 16, 2007 at 12:16 pm 0Likes

    Hear hear.

    Last month at my home we exceeded our 12 gig broadband limit with video downloads, with a couple of movies and two seasons of West Wing.

    All of a sudden, everything started moving at dialup speed. I felt like I was back in 1999.

    How can Australia expect to embrace net-delivered video and other services of the future without offering consumers an unlimited pipe at a reasonable cost?

    The average person’s monthly TV/movie consumption, if done over the net as my family’s already is for the most part, would far exceed the 12 gig cap.

    dave

  • Glenn
    Posted May 16, 2007 at 4:16 pm 0Likes

    Dave…

    Now I trust those were one of the few legal download sources for movies and tv what with everyone knowing your name and employer 🙂

    Just download them for your work connection…

    You are 100% right though… 12 gig is a pittance.. It has probably been over 3 or 4 years since I downloaded under 20 gigs per month unless I was away on holidays.

    Poor Johnny thinks the only reason Australians are not gonna vote for him is because of our sense of humour!!! He thinks all the people being polled are playing a joke on him. How can someone with so much political experience think so little of the Australian people to make that claim.

  • Peter
    Posted May 16, 2007 at 5:44 pm 0Likes

    I can tell you, Telstra only offered ADSL2 when it started losing clients en-masse, it only offered VOIP when it started losing revenues.

    The thing that annoys me about so many of these big companies is that they think they have an inherited right to a monopoly.

    The Liberal Party have done things in the past to enhance business because they know the more money big business make the more they employ (it seems to be an infatuation), but I think with the election coming up they will have to tread very carefully with this o as Labor’s policy is actually as good as I have seen in this country in respect to broadband.

    Get ready for the al mightiest scare campaign in Australia political history!

  • Paul Krayven
    Posted May 18, 2007 at 12:23 pm 0Likes

    If and when the consumer gets a real choice Telstra will seriously have to reconsider it’s future. Even now I have 8MB ADSL at home’s run a voip phone through it and use my mobile for other calls, yet I still have to pay telstra for line rental for the adsl! It’s insane. I for one will not choose a telstra product or service if I had a choice.

  • Peter Ricci
    Posted May 19, 2007 at 8:27 am 0Likes

    Paul, perfectly correct. However when you have governments that are only concerned about money then you will have what we now have with Telstra. Instead of doing what was right for the people of the country and splitting the telco up like they did in the USA then you will always have monopoly pricing.

    Nobody ever talks about how much this costs the consumers or businesses. I think I would have at least another 20k in my pocket if it were done the same way as what was done in the USA.

    They would still have raised about 70% of what they did by privatising, but by keeping the network (last mile) in public hands we all would have saved much more than could possibly have been made in dividends.

    They have also done the same with airports and roads, what is next? Australia Post?

  • Peter
    Posted May 20, 2007 at 11:59 pm 0Likes

    This was in February 2006 – “Telstra has a bold and ambitious plan to secure its future prosperity: it will understand its customers needs and wants much better than any telco before, enabling it to target its marketing and its products and services much more precisely than ever before, but its network will also need to be able to efficiently deliver these personalised services.

    The grand plan was set out by CEO Sol Trujillo in a briefing to analysts on the company’s half year results earlier this month.”

  • Peter
    Posted May 21, 2007 at 12:01 am 0Likes

    1. We need faster broadband
    2. We need no more of this national call costs, local and national calls for a fixed 15 cent calls untimed.
    3. Someone to answer a support call within 2 minutes.
    4. Competition

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