Telstra Tipped To Lift Mobile Services Prices After Slashing 2,800 Jobs & Admits They Are Failing In B2B Market

Under the previous Telstra CEO Andy Penn, 10,000 jobs were slashed. Now, Vicky Brady, the current CEO, is axing an additional 2,800 jobs as the business struggles in the B2B and enterprise markets with the business tipped to also be looking at raising the cost of mobile phone services.

The business that has an appalling service record, is struggling to compete against cheaper internet-based communications companies, with many of their customers dumping Telstra because of poor service and uncompetitive pricing.

They are also moving to restructure their outsourcing arrangements which is currently operated via India with many of their Indian call centre staff unable to offer any information other than what is in a script they are reading from, as 4Square Media found out recently when trying to facilitate an NBN connection at a new address.

The carrier also plans to stop its traditional annual inflation-linked price reviews with the business now wanting the “flexibility to adjust prices at different times”, claims Brady, with analysts tipping future price rises.

Demand for the Telstra products is slumping especially with big businesses and governments who are cutting what has been described as “better deals with other providers of communication services”.

Some 377 jobs will go immediately, with thousands of other jobs gone by the end of December.

The cuts represent approximately 10 per cent of their workforce. They are also looking to potentially offload some of their customers to other players as they struggle to deliver profitability.

One of the major problems is voice over IP technology that has resulted in customers, including retailers and distributors, shifting away from traditional voice calls to cheaper internet-based services provided by software companies who then manage the business via cloud-based networks.

Analysts claim that they were surprised by Telstra’s decision to stop its annual inflation-linked price review of postpaid mobile phone plans.

UBS analyst Lucy Huang told the AFR that Telstra’s new fiscal 2025 earnings guidance suggested the company expects its mobile phone business “to continue to be a driver of growth”.

JP Morgan analyst Mark Busuttil said the company’s CPI-linked annual price review had only been introduced two years ago so customers knew by how much their mobile phone plans would increase in price.

“The removal of this policy does make sense given it did not consider competitive dynamics of and Telstra’s leading market position,” said Busuttil.