blog The controversial clause in Telstra’s National Broadband Network agreement prohibiting the telco from promoting its wireless solutions as a direct alternative to the NBN’s fibre continues to draw interest, despite protestations from Telstra chief executive David Thodey that the clause would only have a minor impact on his company’s operations.
In an interview this morning with the ABC’s Inside Business program (full video and transcription here), Thodey had this to say;
“The only constraint, and it’s a very, very minor constraint, is to directly put a little pamphlet in someone’s house that says, “Do not buy NBN fixed broadband, buy our wireless broadband instead. That’s the only constraint. We will be promoting our wonderful Next G wireless network, which, as you know, is going to an LTE spectrum. Be it, what, 80 megabits per second? And we will be promoting that product very, very strongly … I don’t think it’s an issue at all.”
So Telstra won’t directly promote Next G as a NBN substitute. But will it price it similarly, achieving direct competition by default? That was interviewer Alan Kohler’s next question … and Thodey didn’t really answer it, noting only that Telstra would price Next G based on “its value” and the flexibility it gave customers.
Now the interesting thing is, if you look at Telstra’s current pricing plans, you’ll note that its wireless offerings are not actually that different from its fixed broadband offerings when it comes to price — especially at the low end. For $19.95 a month, you can get either a 1GB Next G mobile broadband plan, or a 2GB ADSL or HFC cable plan.
It’s only when you get to the moderate and top-end of Telstra’s plans that things diverge wildly … $69.95 a month, for example, buys you a 200GB ADSL or HFC cable plan, but for the same price you’ll only get 12GB of quota from Telstra’s mobile network.
Interestingly, though, most people are predicting that broadband prices will rise when the NBN comes in; and the onset of LTE and Telstra’s regular quota increases on its mobile network (especially anticipated to increase as more capacity arrives through LTE) means that pricing on the two poles or fixed and wireless broadband might actually gradually be converging anyway. With this in mind, the question needs to be asked whether Telstra won’t need to directly promote its Next G network as a direct substitute for the NBN — because its pricing will do that for it anyway.
Image credit: Telstra