Australia - Analysis - Telecommunications Pricing

Synopsis

Telstra has been successful in maintaining its grip on the fixed market. It still reaps 75% of its profitable revenues from access and voice services. However, voice has become a commodity service and is now under threat from resale competition, VoIP and mobile substitution. In reaction to that, Telstra has been rebalancing its services and significantly increased its line rentals. Price caps, bundling and soon triple play will have a massive effect on the pricing of new telecoms services. By 2008, the larger retail service providers such as Telstra, Optus and AAPT, already had adopted a bundling strategy with fixed-line voice, mobile and broadband, as well as introducing capped or bucket plans for fixed-line services. The spread of VoIP, in conjunction with DSLAM rollouts, is a development that could make some inroads into Telstra’s stranglehold on the local access market.