Telstra loses monopoly on Tassie government cellphones

Stuart Corner
Tuesday, 24 June 2008 16:33

IT Industry - Strategy

The Tasmanian government has ended its five year relationship with Telstra as its sole provider of mobile phone services with the award of a three year contract to Optus, but says it expects Telstra to retain a substantial portion of the business because of its superior coverage.

Premier David Bartlett said the Government’s previous exclusive agreement with Telstra had expired and tenders for one or more suppliers to deliver mobile services were called in September last year. “The contract requires Optus to offer mobile voice and data services to all eligible Government agencies and this includes not just calls but SMS services, Internet connections and email access via mobile phones.

“The contract doesn’t guarantee Optus a share of the $4 million spent across Government on mobile services but there are obvious advantages to having more than one provider supplying the Government."

He said that a new agreement with Telstra was still under negotiation and that Telstra was expected to retain a substantial proportion of the total spend because of its coverage advantage.

Agencies will be able to assess the price and product offered by each competitor in making a choice of provider and Optus prices are considerably cheaper than those currently paid by Government [and] Optus has announced plans to expand its coverage in Tasmania and to roll-out 3G capability and this is likely to make the Optus service attractive to agencies.”

Telstra is somewhat out of favour in Tasmania because there is dissatisfaction with the high prices it charges for Internet backhaul to the mainland which is stifling competition in the broadband Internet access market.