Why Macquarie Telecom Dumped Telstra for Optus

Why Macquarie Telecom Dumped Telstra for Optus

Macquarie Telecom is moving to Optus for 5G network

Macquarie Telecom has announced a multi-year wholesale contract with Optus, leaving its former partner Telstra. The MVNO will now resell the Optus network instead, attracted by Optus’ decision to wholesale its 5G network to smaller phone companies.

Telstra has lost other MVNOs to Optus recently, not just Macquarie Telecom. For instance, Aussie Broadband just jumped ship as well, leaving Telstra for Optus.

What is Telstra doing wrong that Optus is doing better? In this article, we’ll discuss why MVNOs like Macquarie Telecom are viewing Optus as a better option.

About the Macquarie Telecom / Optus wholesale deal

Macquarie Telecom targets businesses with NBN and mobile plans, and has been very successful at it. The MVNO recently posted its 13th consecutive half of revenue growth, making it a highly attractive MVNO to have on any major network.

With Macquarie Telecom signing a new $34 million wholesale agreement with Optus, the MVNO will now have more to offer their customers – including 5G. The Optus deal includes reselling the 5G network, which has proved very attractive to other MVNOs like Aussie Broadband which, as stated, have also left Telstra for Optus.

The Macquarie Telecom new deal means that 5G plans will be available, and existing customers will be transitioned form the Telstra network to the Optus network in the coming months.

Telstra still has the widest overall coverage in Australia, but not that much better than Optus

Telstra is still the largest telco in the country, offering the best coverage throughout. However, the difference in coverage between Telstra and Optus is slim, with most of the Telstra advantage lying in 3G in rural areas.

Telstra claims to have overall coverage of 99.4 percent of the Australian population, while Optus coverage is 98.5 percent. The difference is extremely small, so it is hardly significant. Further, Telstra resells a different network to MVNOs, and that network’s coverage is smaller – the Telstra wholesale coverage is 98.8 percent, very similar to Optus.

With both telcos neck and neck in overall coverage, MVNOs can choose either one and still give customers great service.

Optus has granted MVNOs 5G access, while Telstra has not

In 2018, Optus confirmed their strategy includes reselling their 5G network to MVNOs. Then last year, the telco made its promise a reality when it announced that MVNOs could now use its 5G network.

Spintel became the first MVNO on Optus to resell their mobile 5G network. Optus also opened up their 5G home broadband network to MVNOs, and Spintel became the first to resell that as well.

Optus also recently took the crown for having the fastest 5G download speeds in Australia for now – 22 percent faster than Telstra, according to a recent Systemic-PAB report – which is a great selling point for phone companies with access to that network.

Telstra 5G vs Optus 5G

Telstra 5G vs Optus 5G, according to recent Systemic-PAB report. Data source.

Meanwhile, Telstra is still keeping their 5G network to themselves. As a result, the Optus wholesale network is more attractive to MVNOs which are eager to give a taste of 5G to their customers.

Final words – Telstra responds with eSIM for MVNOs

Telstra still have the widest 5G coverage in the country for now. According to Systemic-PAB, a recent study which included a 1600km drive across Sydney and Melbourne indicated Telstra had 78 percent coverage in the area, while Optus had only 48 percent. Telstra themselves have claimed their overall 5G coverage is 50 percent of the population, and they hope to have 75 percent by the end of June 2021.

For MVNOs looking for the widest 5G coverage, Telstra would be the ideal option. But with Telstra still locking MVNOs out of their 5G network, Telstra is hardly an option at all.

To respond to this dilemma, Telstra have recently announced that MVNOs on their network will have access to eSIM technology. This is a significant development, as eSIM technology is set to disrupt the telco market.

Until this recent announcement, only the major telcos had eSIM plans. In fact, the ACCC had expressed concerns over the matter, given the significance of eSIM technology. With Telstra now allowing MVNOs to offer eSIM plans, they have become the only major telco in the country to open the eSIM door to MVNOs. This could make Telstra more attractive to MVNOs in the coming months, especially if Optus continues to deny eSIM access to MVNOs.

 

Neil Aitken

Having worked in 3 countries for 4 telcos on both voice and data products, Neil is in a position to give you the inside track. Get beyond the marketing messages to the best plan for you.