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News, Telecommunications - Written by Renai LeMay on Monday, October 8, 2012 8:26 - 31 Comments
Optus dumps off-peak quota, raises prices
news The nation’s number two telco Optus has revamped its broadband plan structure in a move which will see it follow rival iiNet and dump the practice of separating quota into on- and off-peak chunks, but it has also simultaneously raised prices on most broadband plans, in a move that has already angered some customers.
The company did not announce the plan changes but quietly posted an update on the new plans on its company blog under the name of Michael Smith, its managing director of marketing. “To put it simply, over 30 of our current in-market plans will be reduced to just 12 new plans and bundled offers, making it easier for our customers to select a plan that is best suited to their needs,” Smith wrote. ” … The impact to customers will differ depending on what type of plan they are on however it will mean a price rise on most plans.”
The most visible change on Optus’ plans is that the company no longer separates monthly data quota into on- and off-peak chunks. This practice, once popular in Australia’s ISP industry, has gradually been phased out by most providers, with some moving to ‘unlimited’ plans and some merely integrating the quota into one larger pool. It is believed that many customers never used most of their off-peak quota, as it was generally only available during the early hours of the morning (from 2AM, for example). iiNet also integrated its quotas in March this year, following its acquisition of fellow ISP Internode, which had long trumpeted its own integrated quotas as a strength of its plans.
Optus is now attempting to focus customers around three key bundled plans, at $60 $85 and $110 monthly price points. The plans come with 10GB, 120GB and 300GB of data included, as well as a traditional PSTN telephone line bundled in and a number of call inclusions. The company is also offering customers several broadband offerings without a bundled telephone line (the so-called ‘naked’ plans), which start at $75 per month for 120GB of data included, and ranging up to $85 and $100 per month for plans with 300GB and 500GB of data included respectively.
Optus has also introduced a number of other features to its plans, such as the removal of upfront connection and delivery fees on 24 month plans, including a Wi-Fi modem with all plans, including an Internet security service by default (which Optus says is worth $6.99 per month) and automatically including higher speeds on its HFC cable broadband service. Optional short-term contracts as short as six months have been introduced, and Optus’ FetchTV IPTV service has also been included with selected broadband plans. NBN plans, seniors plans and Optus’ “50GB free broadband plans” will not be affected.
“We feel that it’s worth doing things differently if it makes things simpler to understand. It’s worth noting many of our existing broadband plans have never been changed,” wrote Smith on Optus’ blog. “We pride ourselves on taking an open and honest approach when informing customers of price changes and those customers impacted will soon receive letters notifying them at least 21 days before any changes take place which will give them some options of how they can best manage their services moving forward.”
By streamlining our fixed plans we will be able to offer greater clarity and simplicity when it comes to selecting a home phone or broadband plan through Optus.
However, some have already taken umbrage with the plan changes.
“As a long time customer of Optus Cable, I’ve got to say that I’m pretty disappointed,” wrote one customer in response to Optus’ blog. “You are charging us more for less product, with limited option but to churn to another telco. The Optus network has been affected by widespread congestion, high latency and general performance issues for over 18 months now, with little effort seen to be happening by optus to resolve the situation. I fail to see the benefit to your established client base from this initiative.”
“I don’t understand how Optus can simply break a 24 month contract without getting penalised,” wrote another. “I am sure it is somewhere on a small print, however if it was the customer as in our selfs canceling it I am sure we would have been penalised. Have been a loyal customer for a long time, however I believe it is time to look at other options as obviously Optus does not care about their loyal customers or contracts. Extra $6 a month for what?”
“It’s all well and good for those of you on cable, but the price increases are just crazy for those of us on ADSL … I’m just over 3k from my exchange, so I only get a whopping 5Mbit, so this increase now puts me into the “this is too expensive” bracket for the speeds I’m getting,” wrote one user on broadband forum Whirlpool, in a thread devoted to the price increases. “The vast majority of posts on these price rises show that we are not happy bunnies,” wrote another. “No one likes price rises of course, but this is more than that,-this is a price hike,- with the removal of some previous benefits,-and a prevailing attitude of servicing staff, that you ‘take it or take off’!”
So how bad are Optus’ new plans? Well, not terrible. They are clearly competitive with iiNet, the company’s biggest rival at the moment. iiNet currently offers customers a 400GB plan with a bundled phone line and some included calls for $99.90, which isn’t too different from Optus’ $100 plan with 300GB, and for $85 a month you can get a similar 120GB plan from Optus. For $79.90 you can get a 200GB option from iiNet. Optus is a little more expensive across the board, but then you expect that from Optus (I don’t know why people would pay it when there are cheaper options with generally better service, such as iiNet, but then that’s just me).
But I think what the bigger picture here is that Optus still isn’t giving customers a reason to switch to its broadband offerings. I would expect, if I switched to Optus, that the company would offer me a significantly cheaper deal if I also switched my mobile phone services across. This is the kind of package which iiNet struggles to offer, because it doesn’t operate its own mobile phone network — it merely resells access to Optus’ network — and so you’d think that Optus would go out of its way to get mobile customers onto its network.
But it doesn’t look like Optus is heavily promoting this kind of deal alongside its fixed broadband packages, which puzzles me. The company’s new broadband plans are broadly competitive, but they don’t offer anything which customers can’t get elsewhere a little cheaper, and without a significant bundling incentive, one wonders why you would switch to Optus in the first place. I’m left with the impression that Optus is still not focusing on the fixed broadband market very much, and is even alienating its current fixed broadband base a little. That’s the kind of behaviour which allowed rivals iiNet and TPG to steal a march on Optus over the past decade in the first place. You would have thought Optus would have learned its lesson by now … but apparently not.
Image credit: Optus
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