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Competition forces BigPond to slash prices

BigPond will cut prices drastically from Friday for customers that sign up for a combined 24-month telephone and broadband contract. The Telstra division's managing director Justin Milne said in a statement issued this morning that the offer will see new broadband customers get between six to twelve months' half-priced broadband, with no installation fee.
Written by Renai LeMay, Contributor on
BigPond will cut prices drastically from Friday for customers that sign up for a combined 24-month telephone and broadband contract.

The Telstra division's managing director Justin Milne said in a statement issued this morning that the offer will see new broadband customers get between six to twelve months' half-priced broadband, with no installation fee.

The executive said the offer will be available to all new ADSL, cable and wireless broadband customers who have or take up eligible Telstra fixed line or mobile services and sign up to a 24-month broadband contract.

"This offer is essential in the face of strong competition from other Internet Service Providers who have bundled offers in the market," claimed Milne.

However the zero-dollar install fee applies only to the one-port basic BigPond self-install kit. Other installation options, which can cost between AU$189 to AU$419, will instead be discounted by AU$129.

The executive cited Australia's below-average international ranking on broadband penetration as an additional reason that his company needed to "continue to encourage families and businesses to take up broadband through well-priced offers."

Smaller carriers like Primus and iiNet have in recent times started to bundle high-speed broadband services based on the ADSL2 and ADSL2+ standards with fixed-line packages. iiNet also offers an Internet telephony service.

Past severe price cuts on the part of BigPond have led to Australia's competition regulator crying foul, as similar cuts on one occasion were not passed on to Telstra's wholesale broadband customers.

However a spokesperson from the Australian Competition and Consumer Commission (ACCC) was not immediately available to comment on whether BigPond had sought its approval before offering the promotion.

Neither was a BigPond spokesperson available to comment on whether the ACCC's permission had been sought, or how the promotion would impact any future high-speed broadband services to be offered by Telstra.

The company is expected by several industry sources to release higher-speed plans later this month, to enable it to better keep up with rivals like iiNet and Primus. Telstra has said it is upgrading all of its telephone exchanges to the ADSL2+ standard, which will allow access at up to 24Mbps.

Last week a Telstra spokesperson said there was no launch date available for higher-speed services, but he expected more clarity following new CEO Solomon Trujillo's company-wide review, which is due to be released later this month.

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