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Telecommunications Debt-free iiNet hungry for acquisitions
Telecommunications Debt-free iiNet hungry for acquisitions | Debt-free iiNet hungry for acquisitions |
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| by Stuart Corner | |
| Monday, 19 November 2007 | |
  
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iiNet's financial position has been greatly improved by the ACCC's decision to reduce the price Telstra can charge for the line sharing service from $9 per month to $2.50. Malone quoted figures produced by Roy Morgan research in September showing significant fragmentation at low end of the market, with some 400 smaller ISPs sharing around one million broadband customers against Telstra with 2.2 million, Optus with about 800,000, iiNet with around 240,000, AAPT with 200,000 and Primus with just under 200,000. One of these, EFTel, with around 40,000 customers, which could be a target for iiNet, is itself looking to buy other ISPs. It acquired several smaller ISPs in 2006 and when it announced its half year results in March, it said it was back on the acquisition trail and expected to add significantly to customer numbers in the 06-07 financial year. In July it acquired aaNet , almost doubling its customer base to 40,000. Malone spelt out iiNet's target market demographics saying: "We are also expanding our focus to target a demographic of some four million people whom we refer to as New Economic Orders or NEOs. This term describes Generation X inner city dwellers who dominate broadband and Internet usage who believe that computers and technology give them control over their lives. These people also look at the internet as being a central part of their life and they are selective about the brand they will select." Simultaneously, the company is targeting small corporates and SOHOs. "We have commenced our move into the small corporate and home office sector led by our broadband products which coupled with multi-line VoIP provide a compelling offer," Malone said, "We believe this segment of the market is currently not being fully serviced and with our national ADSL2+ network we are well positioned to offer innovative products in attractive packages." He also revealed that iiNet's just launched 'Naked DSL' service had signed up 650 customers in its first four days, saying this was "well ahead of what we expected." In another move, iiNet is rolling out WiFi hotspots in major cities. Rollout has commenced in the Perth CBD and will follow in the Sydney and Melbourne CBDs over the next nine months. "iiNet customers will be able to access broadband at their favourite coffee shop, bar or restaurant under their existing subscription," Malone said.{moscomment} |
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