Life Tech Broadband, mobile prices drop, but should go lower says ACCC

Broadband, mobile prices drop, but should go lower says ACCC

Prices are on the way down, but could go lower, ACCC. Photo: Getty
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The price of broadband and mobile services fell over the past year, but more can be done by the small number of players in the market, the competition watchdog says.

The Australian Competition and Consumer Commission released a draft market study for the communications sector on Monday.

The study showed while 96 per cent of the broadband market is held by four providers – Telstra, Optus, TPG and Vocus – prices had fallen by 10 per cent in 2016/17.

Mobile phone service prices are down 2.8 per cent, despite three companies accounting for 91 per cent of the market.

The report found that more than halfway through the rollout of the national broadband network, there were “challenges” in terms of meeting customer expectations and competition from wireless plans.

It noted the number of complaints about the NBN was up 79 per cent, with most customers (84 per cent) on speeds of between 12-to-25 mbps (megabits per second).

The ACCC recommended the government reconsider the obligation on NBN Co to recover the full cost of its investment, which was distorting the wholesale market.

“Further work could be done by the ACCC and the Department of Communications and the Arts to examine this issue and in particular possible options that may provide NBN Co greater flexibility regarding its cost recovery objectives, for example, direct budget funding arrangements for non-commercial services, debt relief measures or an asset revaluation,” the report said.

Early termination fees on mobile and broadband contracts are also in the watchdog’s sights.

It says the complexity of such contract clauses are hard for consumers to understand and calculate, making it more difficult to switch providers and seek better deals.

The ACCC will work with providers to more clearly state the pitfalls and benefits of contracts, or no-contract options.