John Linton ....when marketing slogans need to be used.
Times/things continue to change in the data communications industry, as they always have, but not from my personal experiences as fast as they have over the past two years or so. Some people may say that's because the current federal government has decided to re-enter the monopoly communications market causing the current monopolist to panic and change its approach to pricing to re-establish its market shares prior to having to abandon its copper network. That must be part of what is causing so many changes but that is a 'long game' (any real delivery of 'NBN2' services is several years away on current estimates - by the 'NBN2') and the changes that are having most effect are very much those of a succession of 'short games'.....ongoing discounting and more and more 'free' offers that actually include some real free components.
I am wondering whether the recent ACCC ruling that Telstra must reduce it's wholesale charges for a PSTN line to a flat $22.00 will actually produce any sort of price decrease from Telstra Retail to its customers or from Telstra wholesale customers - assuming they get the reduced monthly charge. At the same time it will be interesting to see what effect the ACCC's ruling that Telstra must reduce the wholesale charge for providing a ULL service (whereby the wholesale buyer takes over responsibility for the PSTN line from Telstra) will produce lower charges from Optus who, if the reported pricing is correct, will be charging Exetel greater than 100% mark up for the ADSL2 services we buy from them........an unsustainable pricing approach in a very difficult market.
We have made initial approaches to both Telstra and Optus as to their intentions regarding prices of these services but, not unexpectedly, have received the usual BS replies of "we don't know anything about this/we'll check with legal" - do they really think we are so stupid as to believe that sort of nonsense? I mean if I read it in the media are they really trying to say they know nothing about it? These reported prices represent considerable reductions as far as I can see and are symptomatic of what has been happening over the past two years. If my understanding is correct then, together with the fall in IP and back haul costs over the past two years the basic building block costs of providing telephone and data services to residential customers has fallen quite dramatically during that period - but not as much as the end user prices being charged by the various suppliers have fallen (assuming anyone can remember what they were paying for data and telephone services 2 years ago).
Telstra Retail has lead the way in slashing its prices for telephone/mobile/ADSL services for the past two years and has made life more difficult for any company with which it competes - which I assume is every company. It will now be interesting to see whether the beneficiaries of the ACCC ruling will now drop their prices or whether they will try to hang on to the windfall profits that have been dumped in to their bank accounts. It is becoming very hard to actually follow what is happening in the Australian data communications industry even if, like me, you spend a sensible amount of time studying publicly and privately available and ask a lot of questions of people who are also in the business an, novel concept, actually listen to their replies (I assume the reason nobody I talk to listens to what I say is based on their immensely superior knowledge).
On a lighter note I saw the new iinet ad yesterday while driving. Perhaps the people who designed this ad live in Perth and were unaware of the last company to use "Number Two" as a theme in Sydney. No, it wasn't Avis.....the previous user was a septic tank pump out company that had the smile inducing "We're Number One In The Number Two Business" painted on the sides of its sewage pump out trucks. Does iinet's new slogan then mean that its company is a piece of......?
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