Internode rescinds forced plan changes

Internode managing director Simon Hackett has revoked recent plan changes after they largely affected the service provider's most loyal customers.

The move allayed fears of customers on older broadband plans of price increases between $10 and $60 a month.

The price changes had affected a range of Naked ADSL2+, grandfathered Agile products and plans served using Telstra Wholesale ports.

Customers out of contract had begun receiving 30-day notices of the changes, which were announced last year by Hackett as a necessary move to relieve the provider of "excessive" wholesale costs on some plans.

While this was intended to occur over a "fairly long period of time", Hackett said errors in the algorithm used to notify customers had led to the company's most loyal customers - those with the carrier for more than five years - being targeted.

Acknowledging the issue yesterday on the Whirlpool user forum, Hackett said Internode intended to withdraw price change notices and change the algorithm so those with the carrier the longest would be last to be impacted.

Those who had received the initial notification would never see the aforementioned price rise, as a "goodwill exercise".

"It certainly wasn't intentional – it'd be an insane thing to do intentionally," Hackett said.

"I see it as my fault that this has happened – due to not being more specific in the development of the approach to be used here."

Several Whirlpool users had reported receiving notification in the past week with many initiating churns to rival providers.

Though some congratulated Hackett on his honesty, others remained certain they would move to a competitor in protest at the iinitial plan changes.

End of squeeze in sight?

Telstra's recent structural separation undertaking to the competition watchdog provided indications the incumbent's "price squeeze" on wholesale ports that Hackett had campaigned against this past year could be nearing an end.

Though Internode had negotiated some bundling discounts for Telstra Wholesale customers in past months, the two firms had maintained a strained relationship over price disputes.

In its submission to the Australian Competition and Consumer Commission last week, Telstra said it would align wholesale prices to third party providers with the costs it gave to Telstra retail.

A published rate card would offer flat wholesale pricing as an alternative to commercially negotiated prices, allaying previous criticisms by Hackett that Telstra had played favourites with some companies.

"For the first time, wholesale ADSL2+ pricing will be directly regulate," the telco wrote in its submission.

Should the price changes eventuate - and should the ACCC accept Telstra's undertaking - Hackett said it would likely flow onto Internode's retail prices within 12 months.

"I hope that the SSU filed this week really is the beginning of the end of this price squeeze," he said.