Over the last 6-12 months, Australian wireless broadband providers have been involved in a fascinating price war with one another.
Usually, this can only be good news. More competition ultimately leads to cheaper pricing, and then more growth. In a small market like Australia, which is behind most of the rest of the world when it comes to broadband speed and value, this should only be a good thing. (And lets fact it, any competition to Telstra is a wonderful thing.)
However, as is always the case with Australian broadband, there’s a catch, and it’s certainly not the one you sometimes find when fishing.
Unless you’ve been living under a rock, Optus is one telco that has been hammered from pillar to post about poor network performance over the past few months.
All evidence points to the fact that such rapid growth can’t be sustained. This is largely due to network constraints (at least in Optus’ case, anyway), which ultimately leads to quality of Service (QoS) issues and poor real-world speeds.
These issues have seen the company take a battering, and many consumers are fed up with the level of service being dished up.
So although mobile broadband prices have dropped, is this a wise idea when the networks clearly can’t handle the increased subscribers? At the end of the day, consumers want cheaper prices, but definitely not at the expense of quality of service.
According to the Australian Bureau of Statistics 809,000 Australians were subscribed to a mobile broadband service in June 2008. In December, the number was almost half this, at 433,000. Whatever the market, this is a massive spike in numbers in just a short space of time.
It’s really a two-sided coin though — lower prices across the board will eventually force Telstra to drop its prices too.
Ultimately, it seems as though they’re damned if they do and damned if they don’t.
Got a question or comment? Email ross_catanzariti at idg.com.au or leave your opinion using our comment system.