Learn from the mistakes of others

New broadband row brews
James Riley
australianIT.com.au February 16, 2006

A cut-price broadband service being marketed to home computer users by Telstra is under investigation by the consumer watchdog as potentially anti-competitive, a Senate committee has been told.

Telstra began offering customers broadband connections at $14.97 per month for the first year of a two-year contract last November, provided the customer also signed up for a standard home phone service with the company and held a mobile account.

The Australian Competition and Consumer Commission telecommunications general manager Michael Cosgrave told a senate estimates hearing in Canberra it had raised concerns about the pricing plan with Telstra before the company began marketing the half-priced product.

"The ACCC indicated that it might have some concerns about the offer," Mr Cosgrave told the committee.

When Telstra went ahead with the half-price plan, the ACCC began a formal investigation which could result in the company being slapped with a competition notice.

Under an agreement struck with the ACCC a year ago - a deal under which the last competition notice Telstra faced over broadband pricing was lifted - the company agreed to inform the ACCC of any substantive retail price changes for its high speed internet services.

But though Telstra is compelled to inform the ACCC of retail price changes, the ACCC has no power to stop the company introducing the new pricing even if it has competitive concerns.

"The commission can put its view, and then its up to Telstra as to whether they put the pricing into the market," Mr Cosgrave said.

Labor communications spokesman Stephen Conroy said the ACCC was taking too long to act on concerns about Telstra's possibly anti-competitive behaviour.

as part of it's regulatory oversight of privatised everything, our glorious leaders™ have decided that the regulators don't get to regulate? just report.

of course, they'll get blamed when this leads to massively negative outcomes aka cock-ups and rip-offs). and stand 'idly' by while it happens.

the so-called 'broadband' in question is 256kbs, not broadband as in fast or broad. yes, it is faster than using dial-up modem, but it's not really 'broadband' ... i have something like broadband at 10meg.bits/sec ... only telstra's shitty copper twisted-pair between the exchange and our adsl modem prevents us from getting full 24meg.bits/sec. from our internode dslamm.

in comparison, telstra's 256k.bits/sec is tedious ... and with a 200meg per month download limit!!

but wait, there's another catch for the unwary newbie:

Monthly Plan Usage Allowance MB and GB) means combined upload and download data transfer except for some traffic provided from time to time by BigPond at no cost). For the purposes of calculating usage, 1 Gigabyte = 1000 Megabytes. Unused usage allowance forfeited.

to find out what that means, you have to go looking through the "more info" link ... where you discover that once you pass the 200meg limit you pay $0.15 per MB.the half-price, exciting introduction to adsl on telstra's bigpond isp is recommended for "Light use, or exploring ADSL" which is further explained on another page to mean:

• Enjoy high speed access to your emails and the web, free of hassles such as dial-up delays or not having a phone while you're online.

• 200MB will let you exchange lots of text-based emails per month, visit plenty of interesting web pages, or try some broadband media and music downloads.

• You can have up to 7 additional users. [i can't imagine sharing a 256k link with seven people/machines ...]

they don't tell the unwary what this actually amounts to is pretty much the same kind of use as they were enjoying via dial-up modem. of course, being four times faster, it's likely the unwary will start racking up those additional $0.15 megabytes. which is one of the reasons the accc are unhappy about this product.

Plan	200MB ADSL
Speed Options Downstream/Upstream)1	256/64
Standard Contract Term	12 months
Full Service Fixed Phone Monthly Fee^4 256/64)	$29.95
Non Full Service Fixed Phone Monthly Fee4 256/64)	$29.95
Monthly Usage Allowance2	200MB
Price per MB after monthly allowance	15c
Additional Users3	up to 7
Mailbox Quota	20MB

anyway, back to the exciting offer ...

[i had to run msie for the third time this week to view the fine print of the 'special offer' coz telstra in their wisdom coded the page (in asp of *course*) in such a way that it renders badly in firefox and opera]

The terms and conditions make for interesting reading ... (my highlighting in bold + maroon)

Things you should know

ADSL, Cable & Wireless not available in all areas.

1. Offer available to new BigPond broadband customers, or existing BigPond Broadband ADSL or Cable customers purchasing a Wireless Broadband service. Eligible services only count towards one broadband service discount. Customers who switch their local and long distance telephone service from Telstra will not receive any remaining broadband access discounts. Customers who cancel their post-paid mobile service will have any remaining broadband access discounts reduced by 3 months. Not available with other offers including $20 online sign up bonus, Home/Office and Mobile Cap offer and Cordless Phone Promotion).

2. Free modem is for standard 1-Port modem Self-Install Kit ADSL or Cable). $129 credit available for other install options excluding ADSL Professional Installation, BYO modem and Rapid Transfer Process customers. $125 fee applies to convert from ISDN to ADSL. Min cost on ADSL $29.95 200MB 256/64 plan with 1-Port ADSL Self-Install Kit with free modem and a HomeLine Plus service and $20 Mobile plan is $1737.84 includes special offer discount), plus mobile call costs and any additional usage at 15c/MB. Early termination charges may apply. Standard modem free when customers stay connected for 24 months.

3. Eligible mobile services are Telstra mobile post-paid plans $20 and above per month. Excludes corporate staff plans and Telstra mobile satellite plans.

* Based on Telstra tests using the Motorola SB5100 modem. Speeds vary due to factors including plan selected, customer location, method of data transmission protocol), internet traffic, capacity and popularity of websites and modem and computer hardware/software configuration. See www.bigpond.com for details

? Excludes some dial-up plans.

^ After trial period, you will be put on 10 Movies Per Month plan at standard rates $24.95/mth, plus any additional rental charges), unless you select another plan or cancel your subscription and return all DVDs before the trial ends. One free trial per household. For full terms and conditions see bigpondmovies.com.

† Within a coverage area. Visit bigpond.com for coverage details.

® Registered trade mark of Telstra Corporation Limited ABN 33 051 775 556

BIGPOND® BIG BROADBAND TERMS AND CONDITIONS

1. Eligibility: To be eligible for the Offer, a customer must:

   1. connect to a new BigPond Broadband ADSL, Cable or Wireless service for 24 months using offer code 3288; and

   2. have Telstra as their local and long distance telephone carrier or preselect Telstra as their local and long distance telephone carrier within 30 days of commencing their BigPond Broadband ADSL, Cable or Wireless service.

   The offer is available to new BigPond broadband customers, or existing BigPond Broadband ADSL or Cable customers purchasing a Wireless Broadband service. Eligible fixed and mobile services may only count towards one broadband service discount.

2. The Offer consists of:

1. a six month access discount "Six Month Discount Offer"), which all eligible customers who take up the Offer will receive; and

2. three additional offers - the Installation Offer, the Online Offer and Mobile Bonus Offer - one or more of which an eligible customer who takes up the Six Month Discount Offer may also receive provided they meet the terms of that additional offer.

3. Six Month Discount Offer: An eligible customer taking up the Six Month Discount Offer will receive a half price access discount on their monthly ADSL, Cable or Wireless plan fee for the first 6 months from connection.

4. Installation Offer: An eligible customer who takes up the Six Month Discount Offer will be entitled to receive either:

   1. $0 installation for ADSL or Cable standard 1-Port modem Self-Installation Kit purchased directly from Telstra. For ADSL 1-Port modem purchased in-store, customers will pay $129 and get a full rebate on their first or second bill; or

   2. a $129 credit on their first or second BigPond bill for other ADSL, Cable or Wireless installation options excluding BYO modem, ADSL Professional Installation or Rapid Transfer Process customers.

   A $125 fee applies to convert from ISDN to ADSL.

5. Online Offer: An eligible customer who takes up the Six Month Discount Offer is also eligible to receive a half price access discount on their monthly ADSL, Cable or Wireless plan fee for an additional 3 months if they:

   1. apply for their BigPond Broadband service online at www.bigpond.com; or

   2. have BigPond online billing or apply for BigPond online billing within 30 days of commencing their BigPond Broadband service.

   Customers who take up the Online Offer are not eligible to receive the $20 online signup bonus.

6. Mobile Bonus Offer: An eligible customer who takes up the Six Month Discount Offer will be entitled to receive a half price access discount on their monthly ADSL, Cable or Wireless plan fee for an additional 3 months if they have an eligible Telstra Mobile Service.

7. An Eligible Telstra Mobile Service is a Telstra post paid mobile service on monthly plan of $20 and above, connected within 30 days of commencing their BigPond Broadband ADSL, Cable or Wireless service, but excludes corporate staff plans and Telstra mobile satellite plans.

General provisions

8. Services connected under the Offer are not eligible for Telstra Rewards.

9. If a customer switches their local and long distance telephone service from Telstra during their BigPond Broadband contract term, they will no longer be eligible to receive any remaining broadband access discounts for their Six Month Discount Offer discounts and any Bonus Offer discounts.

10. If a customer cancels their post-paid mobile service or cancels their online bill if applicable) during their BigPond Broadband contract term, they will no longer be eligible to receive any remaining broadband access discounts for their Bonus Offer discount.

11. Customers who do not preselect Telstra for their full service home phone within 30 days of their broadband activation will be placed on a standard 24 month broadband plan without any discounted access fees.

12. All discounts will be provided in the form of a bill credit equal to half their monthly plan fee.

13. All of the standard charges apply eg call charges, excess usage and additional services).

14. Offer not available in conjunction with any other offers including the Home/Office and Mobile Cap offer and Cordless Phone Promotion.

15. ADSL customers must have their BigPond Broadband service and their fixed line service at the same address. Wireless and Cable customers must have their BigPond Broadband service and fixed line service on the same account.