Are budget mobile providers in Australia dying?

The current woes of wholesaler ISPOne highlight an emerging trend in low-cost Australian mobile telephony. Where are all the budget players going?
(hint: They’re vanishing, or at least restructuring to be worse value than before)
The news broke yesterday that ISPOne, a wholesale provider that acts as the middleman between Telstra and several low-cost mobile providers — Kogan Mobile being the best known after its own court battles with ISPOne — was in court yesterday arguing with Telstra over the potential disconnection of some 280,000 customers.
Josh Taylor over at ZDNet has a nice summary of the court case as it stood yesterday, while Trevor Long at EFTM notes that it looks like ISPOne will restructure in order to stay in business. I’d tend to agree with his analysis that it looks like the death throes for the company, although anything’s possible.
So what happens if they go under? Unless providers such as ALDI Mobile and Kogan Mobile can secure the services of another wholesaler (and wholesale telco isn’t my field, so I’ve no idea if that’s even a possibility), they’re presumably going to have to cut services. What does that mean if you’re a customer of theirs?
Firstly, it should be noted that you’re a customer of theirs, not of ISPOne, and that has certain meanings under Australian law. Although I’m obliged to point out that I’m not a lawyer and this is not, strictly speaking, legal advice, because that also has specific meaning under Australian law. Still, I can’t see where any of what I’m about to say wouldn’t be absolutely correct. I’m happy for any lawyers reading this to correct me.
That out of the way, if you’ve paid for services from a company that’s still operating — and it seems unlikely that either Aldi or Kogan are going to go bankrupt any time soon — and they cancel the service, you should be entitled to some form of refund, especially if you’ve paid for a long-term service; it’s feasible that if ISPOne is wrapped up quickly and you’re only on a 30-day plan that your service may simply be ceased at the end of that period. They can’t shift the blame onto ISPOne (or any other provider), because your contract for service is with them. It’s the same reasoning why if you buy goods from a store, they’re the point of contact in terms of disputes, not the product manufacturer. They took your money, so they have obligations to you as a customer, to put it simply.
It would probably also be wise to look at shifting if the mobile number in question is important to you, as I could see portability being a very sore spot if the consumer-facing providers no longer have the infrastructure to do so and ISPOne is no longer around to provide that service.
What’s also interesting here is how the landscape is shifting away from the provision of genuinely low-cost mobile broadband plans, and towards more expensive solutions, especially for data. Virgin Mobile’s recent “irresistible” plans are a good example of relatively poor value hiding behind a high-cost facade, but if you’re not even in that price bracket, you’re left with fewer choices every day.

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.