Australians are paying more for higher internet speeds and mobile phone data that they might not need according to the Australian Competition and Consumer Commission (ACCC).
ACCC Commissioner Anna Brakey said the Commission’s latest Communications market report found consumers were paying more for their broadband and mobile phone services than they were a year ago, but were receiving faster NBN speeds and more data allowances in their mobile plans in return.
“For people who had an existing plan that already met their needs, it is unclear if the higher speed or extra data is sufficient trade-off for the higher price,” Ms Brakey said.
She said Telstra, Optus and TPG increased prices across a range of their flagship products this year and the price of entry level pre-paid mobile services rose by 16.2 per cent on average.
“Reducing the expiry periods on prepaid plans from 35 and 42 days to 28 days is a price increase by stealth,” Ms Brakey said.
“Over a year, it means consumers are recharging more often, and therefore paying up to 25 per cent more for their mobile phone service,” she said.
“While average mobile prices rose, Telstra, Optus and Vodafone have moved towards a ‘more-for-more’ model in which they offer 50-100 per cent more data across their plans at a higher cost.”
Ms Brakey said, however, it was unclear if people wanted or needed the additional data allowance as an average person was not “going anywhere near using the average mobile data allowance”.
She said the ACCC held concerns over reduced competition since the merger of TPG and Vodafone in 2020, with consumers now paying more for mobile phone plans.
“With the market now heavily concentrated with just three players, prices on many popular plans have risen as price competition is muted,” she said.
Ms Brakey said the price of broadband services also increased in 2020-21 and those who moved their service onto a higher speed plan paid between six and eleven per cent more than in the previous financial year.
The ACCC’s 66-page Communications market report 2020-21 can be accessed at this PS News link.
