Telstra has threatened Optus with legal action over its claims that the iPhone will be able to use Optus' upcoming HSDPA network with 98% coverage.
Telstra took issue with the following paragraph of a media announcement from Optus about the iPhone: Optus CEO Paul O'Sullivan said, "With Optus, more iPhone users can enjoy 3G services as we expand our network to 96 percent of the population by December 2008 and 98 percent by December 2009. We look forward to providing our unique services and content to consumers and business customers via this outstanding handset.”
“Just this week Singtel Optus’ CEO was claiming a new mobile would operate on its proposed 3G network but failed to mention it was on the wrong frequency. It’s like someone claiming they can get cable TV without a cable," said Telstra spokesman Peter Taylor.
“It’s important that consumers understand when they are choosing their mobiles that some of these new phones simply won’t work properly on other frequencies like 900,” Peter Taylor, Telstra spokesman.
Telstra said that it considers Optus' coverage claims a breach of the Trade Practices Act, amounting to a false representation about quality of service.
Telstra has a lot of experience with this very problem, which is no doubt why it is particularly sore about the issue. Its Next G network runs only on the non-standard 850MHz frequency, which initially caused problems with supply of phones. Mobile handset market leader Nokia was unable to supply a compatible handset for months after the launch of the Next G network, causing much angst and embarrassment to Telstra and Nokia executives at the time.
However, for once, Telstra is making a point that is very beneficial to consumers. The truth is that any customer buying an iPhone through Optus or Vodafone will only be able to use the Optus/Vodafone shared 3G network, which runs on the 2100MHz range. These networks have very limited coverage — major metropolitan areas and some regional centres, but nothing like the blanket coverage of Optus and Vodafone's two separate 900MHz HSDPA networks.
Finally, Telstra dropped a strong hint that it may still sell the iPhone. " "Telstra is the market leader in mobiles and we aim to stay that way, so while not commenting on iPhone or our plans specifically, watch this space.”
The iPhone is compatible with the 850MHz frequency used by Telstra's Next G network, which means that if Telstra does offer it, it would be the only operator to offer the iPhone with blanket national HSDPA coverage.
Whether Telstra offers it at a price anyone can afford remains to be seen, of course. Other Next G services are routinely two to three times more expensive than similar competing services. Telstra justified a round of Next G price increases at once stage by saying, "If you want to travel first class, you'll be prepared to pay more."