Telstra leaves options open to combat competitors after network outages

Telstra is focusing on its “value equation”. Photo: Craig Sillitoe Telstra is constantly revising its mobile plans, COO Kate McKenzie says. Photo: Ben Rushton
Nanjing Night Net

Telstra is prepared to pull the pricing lever and change its mobile plan offers to fend off its competitors looking to take advantage of the telecommunications giant’s recent network outages and lure customers away.

Telstra customers have experienced four outages in the last two months, and rivals have sought to cash in on its difficulties.

Vodafone Australia last month offered customers switching from rival networks a free month of mobile services – the offer lasted one week and expired in March 29.

Asked whether Telstra would consider reviewing its plans in response to its rivals’ moves, chief operations officer Kate McKenzie said the telco was constantly revising its offers.

But she did not detail exactly how the company would react.

“We want to keep on providing value for our customers and we’ll keep looking at that,” she said.

“We’ll keep looking at the competitive responses and we’ll make sure we’ve got really good offers out there that provide value to all of our customers,” Ms McKenzie said.

Telstra has 16.9 million mobile customers, compared with 9.37 million at Optus and 5.44 million at Vodafone Hutchison Australia.

Ms McKenzie acknowledged that Telstra’s competitors were using its network outages as a means to try to convince its customers to switch.

“Over recent weeks, clearly competitors have been in there,” she said

“That’s a natural reaction in a healthy and competitive market. Customers will continue to choose between carriers to get the best option for their needs, and we’re very comfortable that we’ll continue to be a very good option for our customers.

“All of our current efforts are focused on making sure that value equation still works for our customers. We will always aim to provide value for our customers and continue to invest in the network. We’ll leave no stone unturned in terms of what else, if anything, we need to do, and that will continue to be our focus.” Long-term gains

Last year, Telstra chief executive Andy Penn told Fairfax Media he would be willing to make short-term sacrifices to the telco’s mobile margins in order to pay for better networks that would lead to a longer-term gain.

“Yes, if continuing to perform in the market impacts margins in the short to medium term, well, it’ll impact margins in the short to medium term,” he said.

“People know that Telstra’s network is the best network in Australia and we’re willing to invest to keep it that way … and if that means raising the investment again we’ll do that.”

Ms McKenzie noted that in the three years to June 2017 Telstra will have invested $5 billion in its mobile network.

On Sunday, Telstra offered its customers a free data day as an apology for the most recent outage.

Telstra customers downloaded a total of 2686 terabytes of data, setting a record for the most amount of data downloaded over 24 hours on its network. Slower speeds

Some customers complained of slow speeds, however.

Telstra said the high demand caused congestion on the network in certain areas, so that some users experienced slower speeds. The company says it did not deliberately slow or “throttle back” the network over the weekend.

“It’s like everybody trying to get on the road at once. There’s not enough room for everybody so they shared the bandwidth that was available. That meant they all slowed down when they all tried to use it at once,” said Telstra group managing director of networks Mike Wright.

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