Telstra Gives Away a Free Kick on ISP Pricing

Telstra has moved quickly to scotch
mainstream media reports that it was considering introducing free Internet
access through its ISP arm, Big Pond.

The Australian newspaper, the only national broadsheet paper in the
country, carried a front page story on Tuesday morning quoting Telstra
executive John Rolland as saying the free access model had “established
itself in the market”, and that internal documents showed it had been
considering the model as a way of growing its subscriber base from the
existing 350,000 to 400,000 users to one million.

However, a Telstra spokesperson told a reporter from Australian Associated
Press later in the day that there were “no current plans” to include a free
access element in Big Pond’s services.

The spokeswoman also criticised the Australian’s use of an internal Telstra
memo regarding an experimental broadband network being set up in a suburb
of Melbourne called Townline, saying that it had “no bearing whatsoever” on
its wider plans for Internet access provided by the company.

The furore comes only days after Telstra dropped its prices for retail
Internet access by 20 per cent across all of its consumer products. Both
moves were seen as attempts by Telstra to aggressively undercut the 800
other ISPs in Australia, many of whom are its wholesale customers.

Telstra’s share price dropped seven cents during the day to AUS$7.37 to be
less than 25c above its 52-week low of AUS$7.14, after being above AUS$7.70
a week ago before news of the price cuts was released.

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