iiNet, Internode bemoan Telstra cuts

National broadband providers Internode and iiNet have cried foul after Telstra's BigPond unveiled massive price cuts for its broadband plans.

BigPond slashed the price on its top-speed 200GB plan by half from $179.95 per month down to just $89.95, dramatically undercutting the prices of similarly rated plans at Internode, iiNet and others.

The price changes bring up the question of whether Telstra will pass on price cuts to its wholesale customers. Internode and iiNet have previously alleged that Telstra's low retail prices have made it difficult for the carriers to compete.

"We are in discussions with our wholesale customers regarding their pricing," said a Telstra spokesperson this morning. "Lower broadband prices and increased value for money are great news for customers, with our new offers a direct response to the very high level of competition in the broadband market."

But that answer was not good enough for Internode, with a spokesperson for the internet service provider saying this morning that it would amend its existing complaint on Telstra prices to the Australian Competition and Consumer Commission (ACCC) to include Telstra's latest pricing change.

Internode general manager of Regulatory and Corporate Affairs John Lindsay said BigPond's price cuts provided additional evidence of Telstra using its monopoly position to limit competition, and that Internode would now await a response from the ACCC.

"In the meantime, Internode continues to sell price-competitive services on its own broadband infrastructure," he said.

iiNet has not been available for comment on the situation. However, the group's chief regulatory officer Steve Dalby told ARN today that BigPond's move was "uncompetitive" and that Telstra's wholesale prices were "artificially high", with retail prices being below wholesale pricing.

It's not the first time a brouhaha has erupted in Australia's broadband market over Telstra's wholesale prices. As far back as 2001 Telstra was wrangling with the ACCC and other telcos over the issue — and the problem has continued to plague the big T since that time.