John Linton As predicted (by me and everybody else who spends time looking at what's happening in the Australian communications markets) Telstra again cut the prices of its wireless broadband services and raised the included download allowances:
http://www.itnews.com.au/News/235622,telstra-raises-quota-on-big-wireless-net-plans.aspx
When you see things like this:
"The new plans saw Telstra offer 7GB for $59.95 a month (previously 6GB for $79.95) and 12GB for $89.95 (previously 10 GB for $119.95)."
you do have to wonder at how far large companies go to rip off their customers for as long as possible (same with the Optus pre-paid mobile plans I commented on last Sunday). I mean, what has changed over the course of the 6 or so weeks between the last price decrease and this one to make it possible to offer the same service for 30% or so less? Nothing - is the answer to that question. Also bear in mind that this will not be the last price reduction between now and Christmas from Telstra or Optus in terms of their 'retail' offerings. I am not, in any way, complaining about these reductions - they simply confirm that wireless broadband will continue reduce in price and increase in speed as time passes (a self evident scenario for any communications technology for the past 150 years). But then the 'average' residential buyer continues to sign up for 24 month contracts even when they actually do understand that prices keep falling at shorter and shorter intervals....there obviously IS "one born every minute".
So its always been a given that wireless broadband would become more and more 'competitive' with lower end ADSL as a sensible option for some 50% of the current marketplace to use for residential purposes and while these current prices don't quite reach that point they are very, very close now. In fact if you drop the cost of the wire line monthly rental they pretty much are at the ADSL Replacement Point. If the assumption is right, that Telstra and Optus' prices will drop further between now and Christmas, it will be interesting to see whether the take up of wireless broadband does produce a more significant decline in the ADSL numbers in the next ABS survey results. You would also think by now that the "advisers" to the gubmant would be having to re-look at their idiotic dismissal of the development of wireless broadband and invent some new figures to support their statements that "wireless will never be a significant.......".
All very well in macro terms - the US carriers and their customers have made this situation blatantly obvious for two years. It doesn't help companies like Exetel make sensible decisions on what, if anything, we can do in making 'better' wireless broadband plans available to our own customers. There is no point in producing a set of plans now which will have to compete with Telstra and Optus 'Christmas specials'. We will have to come up with something shortly or forget about the residential wireless broadband marketplaces and spend the time and money somewhere that has some chance of producing a meaningful result. I was trying to pick a sensible 'experimental' plan pricing last night in preparation for a meeting later this morning. I came up with $30.00 for 3 gbytes as being the 'golden' value price point (based on what the 'market' wants - not what we could afford to provide) and I will be interested with what the other people in the company who are involved in this exercise come up with.
Numbers like $30/3gbytes make you realise there is no real point in getting out of bed any morning. However it does remind you that such a service now far exceeds the 'value' (and the utility) of all the ADSL1 plans for people who use less than 2 gigabytes of monthly down loads - which is a very, very large percentage of total users. Although there are attempts to portray the majority of current internet users as being obsessed with speed and huge downloads the reality for ALL ISPs is that somewhere around 50% of all users download less than 2 gigabytes a month and a serious percentage of those users have speeds of 1500/256 or less but pay more than $30.00 a month for their service and have to pay another $30.00 for a land line to be able to obtain their ADSL service.
.....and of course....these current wireless broadband prices will only get lower and the speeds will only get faster.....that are already better than 50% of ADSL users pay and obtain.
PS: Although I commented that it was looming - it has finally happened:
http://online.wsj.com/article/SB10001424052702304410504575560510623029090.html?mod=WSJASIA_hpp_LEFTTopWhatNews
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