Telstra cable pricing causes trouble

Telstra is at risk of losing Internet cable customers following the introduction of a new pricing structure at Big Pond Advance where specific data transferred using the service will incur charges.

Following notification of the changes, customers have posted threats to leave Telstra in favour of Cable & Wireless Optus on a user newsgroup. CWO launches its cable modem service Optus@Home early next year.

The user group surveyed 482 user and says 84 per cent of participants indicated they were "planning on leaving" the service. Only 2 per cent indicated they were happy with the new tariffs, the survey said.

In a e-mail notice issued to customers late Tuesday night, Telstra announced it would simplify its pricing plans, increase the megabyte (MB) allowance and reduce the per MB pricing. The company also forewarned customers that from January 10, 2000, some data transfers, including e-mail, newsgroup and local traffic would incur usage charges.

For the majority of customers, Telstra has introduced a new plan where customers are charged $65 per month for 250MB with any additional downloads charged at 28 cents per MB, Melanie Feez, Telstra's manager, broadband internet services said.

Alternatively, customers can choose a $50 per month plan with 100MB and a rate of 35 cents per additional MB.

Feez said most customers have currently been paying $65 per month for 100MB, with additional downloads charged at 35 cents per MB.

"We've received feedback in the last 6 months that our charging is too expensive," Feez said.

"We've essentially responded to customer complaints from typical residential customers."

Feez said the "typical residential customer" makes up around 98 per cent of BPA's 12,000 plus customer base.

"One per cent of customers are affected adversely by the price changes.

"The biggest impact will be on customers downloading large data traffic through newsgroups," she said.

"For the vast majority of customers, the pricing changes will result in a lower bill based on current usage."

Feez expects the majority of unhappy customers to be the small percentage of subscribers who regularly download large amounts of data, sometimes downloading applications generating costs of $30,000 per month.

"They are the customers who are very unhappy. . .they are the customers who are abusing the service and creating unfairness for everyone else," Feez said.

Feez said Telstra would like to provide a service to those customers who are "costing $30,000 per month and feeling that's well within their rights . . . but [would] prefer them if they're paying."

According to Feez, the new pricing structure is very much Telstra's attempt to "chase the new market", and aggressively target the market before the Optus@Home launch.

According to Melissa Favero, spokesperson from CWO, Optus@Home will be launched early next year and will be available to 2.2 million users in Sydney, Melbourne and Brisbane.

Favero said CWO is yet to announced the price or pricing structure of the service, but said CWO's "offer will be competitive".