Internode have this afternoon confirmed a number of existing out-of-contract customers would have to be moved onto the company’s newer plans because of a wholesaler “price squeeze”.
In a post on the company’s blog, Internode managing director Simon Hackett confirmed a number of Internode customers who are out of their contract period would have no option but to switch to one of Internode’s new plans, unveiled earlier in the month.
Hackett said the “consideration process” about moving customers onto the new plans in some areas is now complete, with the Internet provider deciding it had no option but to move some customers across. “While the majority of our customers are not impacted, unfortunately some of our customers will be,” Hackett wrote.
Affected customers will from today receive notices in the mail giving them 30 days notice of the plan Internode intends to switch them to, with customers given the option to change their Internode-elected plan, terminate their Internode service or agree to the changes.
To be sent such a notice, customers will have to be out of their contract period, be on one of Internode’s older plans or live in a geographic location that isn’t serviced by one of Internode’s own DSLAM services or those of other, more competitive wholesale DSL providers.
“We sincerely regret the (rare) occasion of having to impose a price change for some of our existing customers,” Hackett added. “This is not being done lightly, and despite the Internet industry being a bit of an anomaly in the services industries in general (in the sense of it not tending to impose price rises very often, compared to things like power, water and gas bills, for instance), on this occasion these changes are necessary ones.”
The controversial new plans caused a stir amongst some Internode customers, because it turned out that some were better off on their existing deal. Internode however claimed the high wholesale prices placed on the company meant pricing had to be adjusted in order to allow the company to remain “financially sustainable.”
“Absent of any ACCC activity to encourage appropriate change, our most recent wholesale pricing negotiations have failed to yield any effective improvement in our access costs,” Hackett wrote last month upon the announcement of the new plans. “In fact our effective wholesale access costs have actually risen in some geographic areas despite movement in the opposite direction in applicable retail pricing conditions.”
At the time, Internode was considering its options on whether or not it would have to force existing, out of contract customers across to a similar new plan because of the so-called price squeeze.