Wireless ISPs criticise broadband pricing model

Telstra's broadband pricing remains a "sting in the tale" for Australia's SME and residential users, and will continue to be so unless the telco reduces its wholesale charges, industry representatives claim.

Speaking at an 802.11 Planet.com wireless conference in Sydney last week, representatives from up-and-coming providers BigAir and Unwired, as well as the CSIRO and Gartner, agreed that pricing continued to be the main inhibitor stifling mainstream SME broadband uptake.

At present, SMEs fear broadband because of the unknown charges and costs incurred during the month, said BigAir CEO Jason Ashton.

"SMEs and business users want certainty in the price of their usage bill every month," he said.

In addition, many SMEs are doing a like-for-like comparison between dial-up and broadband costs, said Unwired representative and former MCI-Worldcom boss Suzanne Campbell. Such comparisons don't take into account other incidental charges, such as disruption costs, for example.

"They (SMEs) need to know it's not just dial-up charges versus an always-on connection," she said.

There to discuss the role wireless will play in delivering last mile access solutions, the panel inevitably turned to the influence Telstra exerts on broadband through its wholesale pricing structure.

Ashton lashed out against the usage model used in current broadband billing systems, blaming Telstra's underlying monopolistic control of infrastructure for the high and unpredictable costs of accessing broadband services.

In response to questions on whether Telstra's wholesale charges were indicative of the costs of establishing content and infrastructure or inflated, Ashton said Telstra charged "what the market will bear".

"Getting content is not that expensive," he said. "But until we have a clear separation between retail and wholesale, these high prices will continue."

The comments against Telstra's wholesale strategy follow the ACCC's recent decision to release a discussion paper on accessing pricing for wholesale telco services in Australia.

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Nadia Cameron

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