Telstra Opens up 5G to Smaller Telcos

telstra opens up 5G to smaller telcos

MVNOs will soon offer cheaper 5G plans on the Telstra network

Mobile Virtual Network Operators (MVNO) will finally gain access to Telstra’s wholesale 5G network in July. Telstra made the announcement last month, making it the second major telco to open up 5G access to MVNOs in Australia. 

And while other MVNOs will have to wait until July to offer 5G plans on the Telstra network, Boost Mobile is getting a head start – as of 30 May, Boost began rolling out 5G for its prepaid customers.

MVNOs are smaller telcos that resell the major networks to Australians. They typically offer straightforward, cheap mobile SIM plans when compared to Telstra, Optus and Vodafone.

Prior to Telstra’s recent announcement, Optus had already opened up its 5G network to smaller telcos two years ago. However, only two providers currently resell the Optus 5G network. But with Telstra’s decision to grant 5G access to MVNOs from July, Australians will have more options to choose from when shopping for a 5G mobile SIM plan.

In this article, we’ll discuss how MVNOs entering the 5G market could mean cheaper 5G plans for you. Read on to find out.

Australia’s 5G rollout

5G has been available in Australia since 2019, when both Optus and Telstra launched their networks commercially to begin the rollout. Vodafone followed a year later with a 5G launch of their own, giving customers more options.

However, while the three major telcos were rolling out 5G, smaller telcos did not have access to the technology for some time. This changed when Optus announced that MVNOs were now allowed to resell their 5G fixed home wireless network to Australians a year after its launch. 

Spintel was the first MVNO to take advantage of the Optus 5G fixed wireless network. Shortly after, Optus also opened up its mobile 5G network to MVNOs, and Spintel took advantage of that as well. Aussie Broadband joined the race a bit later, also reselling the Optus 5G network.

How Telstra’s wholesale 5G network could bring cheap 5G plans to Australians

As of today, Spintel and Aussie Broadband are the only MVNOs offering full 5G services to Australians, both on the Optus 5G network. While this is a positive step, it hasn’t done much for competition in the 5G market yet – with such a small number of telcos offering 5G plans, prices have remained relatively high.

Now, however, Telstra’s recent announcement could spur competition in the 5G market. MVNOs will now be able to resell Telstra’s wholesale 5G network in their own SIM plans. This would mean more options in the market, which usually results in more competitive, cheaper plans for consumers to choose from.

In fact, although Telstra’s wholesale 5G network won’t be officially available to MVNOs until July, Boost Mobile already has access to the high speed service. Boost has been a Telstra favorite, evidenced in the fact that the smaller telco has been the only MVNO to have access to the full Telstra mobile network over the years.

Boost Mobile announced that customers will begin getting trial access to 5G plans on 30 May at no additional costs. The trial rollout will be gradual, and all you need to be eligible is a continuous active recharge, and an SMS will be sent to your device if and when you are selected. It’s important to note, however, that the trial will end on 26 September, after which customers will be rolled back to 4G.

The number of MVNOs in Australia has ballooned over the years. Most of those MVNOs sell SIM plans from either Optus or Telstra. With both telcos now opening up their 5G network to smaller telcos, you can expect a plethora of 5G plans to choose from. And with more 5G plans in the market, telcos will have to set themselves apart with competitive pricing. This could mean a high likelihood of cheaper 5G plans in the near future.

Spintel can be used as an example of how MVNOs bring cheaper plans to the market to maintain a competitive edge. The phone company resells the Optus 5G network at a lower rate than Optus themselves. For instance, you can get 80GB of data on a 5G plan from Spintel for $50 per month ($40 for the first 6 months based on current promo), while Optus charges $55 for the same 80GB on the exact same Optus 5G network.

How Telstra’s wholesale 5G network differs from its 4G counterpart

The key selling point of 5G is its speed. Theoretically, the fifth generation mobile network could potentially become 100 times faster than 4G networks when fully rolled out. However, when it comes to Telstra’s wholesale mobile networks, 5G has other advantages over 4G networks.

While Telstra has traditionally limited its wholesale mobile networks, the telco seems to be shifting from that strategy. This time, MVNOs will get access to a Telstra wholesale 5G network that includes mmWave 5G and covers over 75 percent of the Australian population – the exact same coverage as the current Telstra full 5G network. 

And Telstra plans to increase its wholesale coverage as the 5G rollout progresses. This is a different approach when compared to Telstra’s wholesale 4G network which offers a smaller coverage footprint than the full 4G network.

Telstra notes that customers can expect download speeds between 10Mbps and 250Mbps from MVNOs which resell its wholesale 5G network. 

Final words – Can MVNOs boost 5G adoption in Australia?

Time flies. 5G has been available in some form in Australia for 3 years already. Even so, it’s unusual to find Telstra handing over a differentiating technology feature (5G) from the mother brand over to some of the smaller telcos in the market so quickly. 

Optus already opened up its 5G access to MVNOs a couple of years ago, but only two phone companies bought in. However, with Telstra now following suite, it’s likely to prompt a similar response from Vodafone and ripple through the market in the weeks ahead. This would mean several more MVNOs offering 5G plans to stay competitive. The net result is almost certainly going to be lower prices for 5G services around the country.

The bigger issue, however, is that unlike in the USA, where more than 60 percent of people already have a 5G phone, only around 20 percent of Australians are currently using a 5G service. Higher prices are responsible for some of that gap, but incredibly, it seems that unfounded safety concerns are the reason (Just to be clear, there are no safety concerns around Australian 5G!)

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.