ispONE in Telstra ADSL2+ dealFont Size: Decrease Increase Print...

ispONE in Telstra ADSL2+ dealFont Size: Decrease Increase Print Page: Print Mitchell Bingemann | January 13, 2009
update WHOLESALE telecommunications provider ispONE will add Telstra to its list of ADSL2+ wholesale providers at the expense of Optus.

ispONE director Zac Swindells cited small margins as one of the key reasons for the move.

Mr Swindells said Optus’s small ADSL2+ footprint also contributed to the decision to switch suppliers. While Optus offers ADSL2+ services from about 350 exchanges around the country, Telstra’s network footprint reaches around 1400 exchanges.

"The Optus exchanges only cover about 13 per cent of the market and offered very small margins.

"Optus covers about 13 per cent of the population with its ADSL2+ footprint. Telstra on the other hand covers 63 per cent of the market. And considering that 65 per cent of our business is done in regional and rural Australia it was an easy decision for us to switch," Mr Swindells said.

The exchange areas offered by Optus were also over-saturated by rival providers, he said.

"Optus operates about 300 exchanges with ADSL2+ but ISPs like iiNet, Internode and others also operate from the same exchange plots. That meant that our customers were competing for market share with these ISPs and it turned into a very aggressively price driven market," Mr Swindells said.

ispONE wholesales to over 150 ISPs including NSW energy provider Country Energy and Southern Phone.

Mr Swindells expects the company’s partnership with Telstra to generate a 75 per cent increase in income over the next year and that that it had already begun offering the new service to 80 per cent of ispONE’s customers.

"Even with all the doom and gloom about, in the last three months ADSL2+ services have been our fastest sellers. It’s not the cheapest product in the world but the demand is huge and is far outstripping any other services we have," he said.

However, ispONE's existing customers on the Optus network would continue using the telco's services.

ispONE joins WestNet, Internode, Pacnet and People Telecom as resellers of Telstra’s ADSL2+ services since the telco first opened the network for wholesale in July last year.

Telstra’s decision to open its ADSL2+ network for wholesale hasn’t been a completely smooth sell for the telco though. Last month the Australian Competition and Consumer Commission (ACCC) began probing claims that Telstra had attached anti-competitive conditions to its wholesale broadband ADSL2+ agreements.

Mr Swindells said ispONE had been contacted by the ACCC about the allegations but said that the ISP was yet to reveal terms contained in its commercial agreement with Telstra to the regulator.

Clarification: This story has been updated since first published. ispONe initially said it had severed ties with Optus.