‘Stealthy price hike’: ACCC exposes hidden price hikes from mobile phone providers

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Australia’s consumer watchdog has cracked down on big tech companies for offering ‘more for more’ cell phone plans, which equates to higher prices for the average customer.

Australian cell phone users pay more for data than they use on “more for more” plans offered by big tech companies like Optus, Telstra and Vodafone.

In response, the Australian Competition and Consumer Commission (ACCC) urged providers to reduce hidden price increases and customers to reconsider their cell phone plan needs.

An ACCC report released on Friday found Australians with a postpaid plan using an average of 11.8 GB of their monthly data allowance of 35 GB.

Meanwhile, people with prepaid plans are using an average of 6.3 GB per month despite a data allowance of 30 GB.

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ACCC Commissioner Anna Brakey said a recent change introduced by operators to reduce the expiration of prepaid plans from 35 days to 28 days amounts to a price increase “stealthily”.

“Reducing the expiration periods of prepaid plans from 35 and 42 days to 28 days is a stealthy price increase,” she said.

“Over a year, that means consumers top up more often and therefore pay up to 25% more for their mobile phone service. “

The report found that people were paying up to 25% more for their mobile phone service, and broadband costs also increased in 2021, with people paying up to 11% more.

An increase of $ 10 per month for a faster broadband plan was refused by 46% of the 650,000 households who tested the Internet using promotional offers.

“For people who had an existing plan that already met their needs, it’s not clear whether the higher speed or the additional data is a sufficient trade-off for the higher price,” ACCC said.

“Mobile network operators, Telstra, Optus and TPG, have increased prices for a range of their flagship products this year.

“The price of entry-level prepaid mobile services increased by 16.2% on average in 2020-2021, due to the increase in the cost of basic plans and reduced expiration periods. “

The consumer watchdog has urged customers to carefully consider which broadband plan is right for their internet needs in order to reduce additional costs.

“As average mobile prices have increased, Telstra, Optus and Vodafone have moved to a ‘more for more’ model in which they offer 50 to 100% more data on their plans at a higher cost,” said ACCC.


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