SUPRATIM ADHIKARI
May 18, 2018
The Australian
Optus is turning up the heat on Telstra, with the telco making significant inroads — especially in the mobile market — on the back of its investments in premium content and its regional network.
The telco’s full-year results released yesterday showed it had added 384,000 new mobile subscribers and 225,000 new NBN broadband customers during the 12 months to March 31.
The past three months saw Optus add 154,000 mobile services between December 31 and March 31, with 101,000 customers in the postpaid category.
According to Telstra’s latest market guidance, it signed up 60,000 postpaid customers during the same three-month period.
While mobile margins are under pressure for all of the mobile operators, Optus boss Allen Lew told The Australian the telco had moved aggressively to bring down its back-office costs.
“We have already done a lot of work in-house to control costs and are remodelling the entire process,” he said. “(That includes) moving away from retail shops and call centres.”
Keeping its costs down has allowed Optus to absorb some pain as it pushes competitively priced mobile plans into the market.
According to Mr Lew, the cheaper price points combined with high data inclusions and exclusive sports content are resonating with customers.
“We have been able to turn things around over the past 12 months, he said.
“This financial year Optus reached the milestone of 10 million mobile customers who are attracted to our award-winning national mobile network, unique content and competitive plans.”
Optus’s full-year 2018 operating revenue picked up 3.4 per cent (year-on-year) from $8.4 billion to $8.7bn. Meanwhile, EBITDA grew 3.9 per cent for the period, from $2.67bn to $2.77bn.
Underlying net profit for the full year was flat at $813 million. The same measure was down 15 per cent for the quarter ending March 31 (year-on-year), from $250m to $211m. Optus had taken a hit during the year in the fixed broadband market because of the temporary suspension of sales of NBN services over the hybrid fibre coaxial portion of the network.
However, the telco’s focus on mobile has allowed it to contain some of the damage.
TPG Telecom’s entry as the fourth mobile player is expected to push mobile prices even lower, further adding to pressure on Telstra, Optus and Vodafone Hutchison Australia,
“I have different weapons in my arsenal to take on TPG and it’s really important to wait and see what type of product they bring to the market,” he said.
“We are the largest wholesale provider of mobile services to virtual mobile operators and can leverage them to target the price-conscious end of the market.”
Mr Lew also played down the prospect of Optus joining Telstra, Vodafone and TPG in pushing an “unlimited” SIM-only plan on to the market.
Optus was the first to the market with a trial plan, but Mr Lew said that it was never designed to be formally launched.
“We would rather look to deliver a truly ‘unlimited’ product, not what’s currently out there,” he said.
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