Optus jacks up broadband prices, introduces excess usage fees

Dan Warne04 December 2007, 11:40 AM

Optus has taken the unusual step of raising prices and introducing hefty excess fees on its popular Fusion home phone and broadband plans.


UPDATE: Optus has advised that its $89 7GB Optus Fusion plan is still available after all. It has just stopped listing it in the menu of plans on the Optus website. It's still advertised here. An Optus spokesperson couldn't say why the plan had been removed from the list of plans.


Optus has taken the unusual step of raising the prices on its popular home phone and broadband plans, making them considerably less attractive.

The $69 plan which offered 2GB of broadband usage and unlimited calls to national landlines and Optus mobiles now costs $79 .

The $89 plan that offered 7GB of data and the same call package is no longer available -- the next plan up costs $99 and includes 20GB of data.

Can we raise prices any time we like: "yes"Can we raise prices any time we like: "yes"
And, after years of promoting its 'shaped' speed service -- where the connection speed just slows down if you go over your limit -- as the more honorable option, the number two telco has caved to the lure of charging customers bucketloads in excess usage fees and is charging $150 per gigabyte of overusage.

Other ISPs like Netspace and Internode have developed popular "data blocks" systems where people who accidentally go over their plan limit can buy a block of extra data to keep their connection going at full speed. The data blocks are still very expensive, to discourage people from remaining on a lower plan than they need, but are not as insanely overpriced as the excess usage rates charged by Telstra and now Optus.

To its credit, Optus has applied an upper limit of $300 on excess usage charges, unilke BigPond which applies no maximum and has billed customers thousands of dollars in excess fees for a single month's usage.

Optus also plans to offer usage alerts via SMS, so customers don't have to remember to log in and check.

Customers who already signed up to the original plans will not be forced to switch to the new ones.

The change comes on top of Optus introducing charging for uploads as well as downloads -- another unpopular practice led by BigPond, but now adopted by some plans from iiNet, AAPT, Dodo and others.

Optus subsidiary Virgin Broadband, which had been offering a 4GB HSDPA wireless broadband plan including unlimited national phone calls and calls to Virgin Mobiles for $60 also recently halved its data allowance to 2GB.

Existing Virgin Broadband customers will continue to get 4GB a month, but new customers will have to pay $70 if they want the 4GB allowance rather than the 2GB one.


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Prometheus:

It seems that Broadband in Australia is just getting worse and worse... Perhaps the New Government should actively consider nationalising the entire network (not the ISP's but the actual hardware and exchanges). Perhaps then we can be given what we truly deserve, a broadband network comparable to the rest of the world...

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

port:

Based on what's being proposed by the New Government, what we'll actually get is an overpriced and generally useless network managed in a half-arsed manner by Telstra.

In other words, party like it's 1999.

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Slippery Jim DiGriz:

Absolutely, and every roadside switch box should have a red star painted on it. Anyone for a rousing chorus of 'The Red Flag'!

Its been proven the world over that sustainable progress is achieved through the encouragement of healthy competition at all levels of infrastructure. Any nationalised quick fix in almost any area of (non-military) technological development has generally led to long term stagnation.

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Prometheus:

I don't want to get into a political philosophical discussion in these comments, but... all these previous examples that you don't site (just make broad sweeping comments about) all occurred in countries where they went the route of socialism before having a thriving economy. Soviet Union etc. started they're brand without the big machinery of an industrialised nation. We already have that, and can now safely take the next step on the way to a truly fair and equal society. Simply put, we have the wealth and knowledge at hand to be able to nationalise an infrastructure network and not have it stagnate

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Bry:

I second that suggestion. I think we need to have a nationally owned network to which all telcos pay money to access. It is then up to this national network wholesaler (prevent from being retailer) that works to improve its networks be they copper, optical or mobile/wireless.

It is such crud that these ISPs are raising prices, it is not as though the cost of their delivery just shot up suddenly is it, only their expectations for higher profits and more plump executive perks and salaries.

Rudd?

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Prometheus:

When we are reaching such a crucial time in history where it is becoming necessary for a person to be online and connected to succeed in the world, Why should we be at the mercy of shareholders' whos' only interest in how much money they can earn from the various ISPs? Either the network needds to be run by the people for the people (ie Governemnt) or maybe we need to start up "Community ISPs" a la community banks (Bendigo Bank is one example) and building societies and credit unions, where the people who have a vested interest in the company's profits, are those that use the end product as well... Just another thought on how to really take it to the big ISPs

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Chad:

Just because the biggest 2 telcos have high prices doesn't mean broadband is getting 'worse and worse'.

What I can't get over is how everyone expects broadband to get cheaper when it is a fact of life that generally things get more expensive with time. Food continues to rise in cost, petrol keeps going up, child care.

It shouldn't be upto the Government to hand out cash for broadband when the big 2 telco's are making billions of dollars profit every year. The problem lies with the consumer. 75% of customers are on Telstra or Optus, so why would they want to re-invest their billions of dollars profit each year when people stay with them anyway?

Broadband can only be fixed by consumers.

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

mickeyboy:

Well, yes and no in my opinion. I don't think it's too much to expect broadband prices in Australia to get lower or speeds to improve considerably, especially in regional centres. I think maybe the argument should be turned around: food and fuel prices remain generally consistent worldwide, at least in "first world" countries, so why can Australia not follow the same practices that rein in corporate greed when it comes to ISPs?

This would effectively reduce the cost and mean more affordable broadband, I would think. But again, this is just my opinion.

I agree it's not particularly down to the government to subsidise whenever there's an issue like this, but it is very much their responsibility to stop gloating over the coffers and address some of the social issues that have arisen as a result of the corporate greed that has been allowed to continue unchecked and actively encouraged over the last oh, say 11 years. (opinion!)

In a word: "regulation". It's not a handout, just social reponsibility.

Anyway, it will be interesting to see which way the new government goes....

I also agree that, until the revolution, there's no real need to stay with Optus or Telstra and the only way they can be persuaded to change their ways is by a mass exodus.

This isn't a plug, but I've gone over to TPG. They have pretty terrible customer service, but genuinely no worse than Optus (don't know about telstra - their obscene pricing and massive amounts of fine print have ensured that I have never used, and will never use their services as an ISP).

TPG provide a reliable, no frills or fuss, less expensive service. Their plans are easy to understand and don't lock you in for the term of your natural life. And as a bonus, they don't bombard you with junk mail or television advertising telling you how lucky you are to have them.

There are probably other providers that can give as good or better value/reliability balance, but this is just the one I use.

For someone who doesn't live in a major centre, this is the best of a pretty ordinary choice.

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Lee:

"The $89 plan that offered 20GB of data and the same call package now costs $99 ."

Correction - The $89 plan offered only 7GB of data. I just got onto the fusion plan myself (before new plans took affect) for $99 with 20GB data.

So pretty much the $99 fusion plan stayed the same, and they got rid of the middle plan with only 7GB data.

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

APC administrator:

Good pick up, thanks for that. I've corrected the article.

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Anonymous23:

Does Optus new upload charges apply to their wireless broadband?

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

steeve pink:

It would seem that Singapore Telecommunications needs a few lessons in product marketing.

Raising prices and offering a lesser service is not very attractive to new customers nor ideal in keeping the customers that you have.

This unusual strategy may be part of a bigger plan to make their other struggling subsidiaries look more attractive, ie. Virgin Mobile Australia and Boost Mobile.

Why would thinking Australians support foreign businesses like this?

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

Rock J:

If the new government is serious about broadband uptake amongst Australians, they would do well to send out a brochure to all Australians informing them of the issues to look out for, as well as informing them of sites like broadbandchoice.com.au

(And I don't mean a wordy tome like that ridiculous Protecting Your Children brochure - what a waste of money! Did anyone actually read that?)

The more informed are consumers, the less likely companies like Optus will be able to get away with these tactics.

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

Happy Internode Customer:

You mention optus "charging $150 per gigabyte of overusage." then say "Netspace and Internode have developed popular "data blocks" systems" further on
"The data blocks are still very expensive, to discourage people from remaining on a lower plan"
Just to shed some light on the subject Internode only charge
1 Gigabyte $5
2 Gigabytes $10
5 Gigabytes $15
10 Gigabytes $30
20 Gigabytes $60
30 Gigabytes $90
for extra *data blocks*
i personaly dont find $5 to expensive per gig as a top if i blow my monthly allowance.
i am still stunned someone is charging $150.00 per gig of over usage.
you got your title correct on this arctical *excess usage fees*


29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

Anonymous45678644:

I wounder what optus new campain will be
"At optus we hear you by increasing our prices, charging an extra $300 . We herd telstra will be happy!!"



29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

McBanjo:

Hey guess what Optus??? I will never ever, ever, ever choose you for any of my telecommunications or internet needs. Reputation goes a long way.

What you just made up for in petty, borderline profits, you lost ten-fold, if not more, due to your lies. I'm very sure you just permanently tarnished your reputation.

Now we all know that this was a 'lock-customer-in-and-screw-'em' affair. Not a genuine effort to offer value for money.

And another thing, using Telstra as a comparison for your pricing is not that big of a statement.

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

Tovo:

I just came home after a couple of years living in Sweden. I remember when I enquired about download quota they didn't know what the hell I was talking about. In Sweden you pay a reasonable cost (very reasonable about $50.00 a month from memory) and then away you go. No worry about reaching your limit...there is none. Plus fibre optic cable dominates. ISPs in Australia are getting away with blue murder. I only hope that Rudd makes good on his election promises.

29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

dig59:

It seems to me that Australia is some sort of corporate guinea pig!
the charges applied to consumers in this country be it by banks,telco's, home lenders etc are just not to be found anywhere else in the world!

Speak up Australia, dont just take these charges and moan, rebel by choice. A community ISP would be a great start.

For years Iv'e ben sticking my head out of the window and shouting " I'm fed up and I'm not going to take anymore"

Join me and break this insidious corporate experiment..... local and international CEO's are laughing at us, know why? because they belive we are shmucks, and to some degree we are!



29 February 2008, 8:49 PM (2 years ago)report abuse Send to a friend reply

Marc Lucke:

When I discontinued my mobile and home line services with Optus, they first tried the "you can't, you're on contract (so there)" approach until they realised I was just a few weeks off finishing it. Then their customer service people offered me very low prices to stay. I still didn't though.

Optus have stones, don't they?

29 February 2008, 8:32 PM (2 years ago)report abuse Send to a friend reply

Raymond:

Well, am I pleased I discontinued with Optus a few months ago when they told me my Web/phone bill was going to be $20 dearer per month.

And get this, they said I would be better off.

Yeah, right.

29 February 2008, 8:33 PM (2 years ago)report abuse Send to a friend reply

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