Broadband options: solidify your evaporating bank account

Dan Warne
11 December, 2007
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When I get my Telstra bill each month with the $33 line rental, I feel like the wicked witch in The Wizard of Oz screaming, “I’m melting! I’m melting”. Except in my case, I’m a bloke, so I’m the wicked wizard, and it’s more like “argghh! My bank account — it’s evaporating!”

Telstra, of course, argues that it is frightfully expensive to maintain a network the size of its national copper telephone network, and that is why it must charge so much line rental each month. On the other hand, mobile phone networks must cost a lot to maintain too, but who would put up with paying $33 a month just to have a mobile phone, with no included call value nowadays?

Anyway, Telstra makes an exception to its horrendous line rental fees for customers that have defected to another carrier like Optus — at the time of writing, it had its cold-calling centre working overtime offering them a $59.95 plan that includes 12GB of broadband, line rental and extremely cheap telephony as an inducement to come back. This offer is not available to current Telstra account holders or anyone who rings up wanting it — just people who’ve actually voted with their feet and taken their business to another network. How’s that for looking after your loyal customers?

It is, therefore, an absolutely magnificent development in the Australian telecommunications market that other telcos have finally got sick of being beholden to Telstra’s rates and are starting to build their own alternative telecommunications networks, with lower costs and far more rational monthly fees.

Take Virgin Broadband, for example. It is a wholly-owned subsidiary of Optus and, for $60 a month, offers a home phone line with unlimited free calls to landlines and Virgin mobile phones nationally, as well as 4GB of medium-speed (500 – 700Kbps) broadband. The whole lot is delivered over Optus’s 3G mobile network

Then there’s Optus Fusion which, for $69 a month, also offers unlimited free calls to landlines nationally and all Optus mobiles. You also get 2GB of high speed broadband through either Optus’ ADSL2+ or its cable network.

Unfortunately, in both cases, coverage is limited — with Virgin Broadband, you have to be within Optus 3G coverage, and with Optus Fusion, you have to be within ADSL2+ or cable coverage. Unfortunately, due to the way ADSL2+ works (“ports” must be installed in batches at the Telstra exchange to service homes in the area) you may be in a coverage area but still not able to take up the offer if it has been especially popular with other residents in your area.

Both offers go to show what a little infrastructure-based competition can do for an industry — substantially lower prices than have been seen in Australian telecommunications before.

Until now, most of the telcos have been buying Telstra services wholesale and reselling them under their own brand name, with value-added services attached. Telstra has fought tooth and nail to get these companies off its network so it doesn’t have to sell at pricing it claims is below cost. However, now that its wish is being granted, with telcos rapidly building out their own networks to free themselves from their reliance on Telstra, they are able to offer much lower prices than Telstra does. The irony of this situation is that Telstra is now having to compete in a considerably more cut-throat market than it would otherwise have had to.

Internet telephony company GoTalk recently launched a service called the “Aussie Pack” which, for $14.95 a month, provides unlimited free national phone calls and calls to mobiles on any network. There is no contract commitment either, so you’re free to leave the service if the call quality isn’t acceptable, or for any other reason. All you need is a cheap VoIP adaptor such as the NetComm V100 or Linksys SPA-3102 (search Staticice for the best prioces — see “Hotlinks”), or a modem with a VoIP port built in, and you’ll be able to make calls with your existing home phone.

If you combine that $14.95 GoTalk plan with a $33.45 “Homeline Part” line rental plan (Telstra’s cheapest line rental that can be used with ADSL2+) and a $30 ADSL2+ plan like Exetel’s 46GB plan (6GB for daytime use, 40GB overnight), and you’ve got all your broadband and phone calls for $78.40 a month — a pretty significant saving on what most people would be paying at the moment.

After reading this article, it’s time to take action and halve your monthly phone bill. The half you’ve saved can be used for that CD you’ve been wanting, or a dinner with your loved one, a movie, a DVD, or whatever your heart desires — just don’t give it to your telco.

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