Optus chief takes aim at OTT services, NBN

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Optus chief takes aim at OTT services, NBN
Kelly Bayer Rosmarin.

Sector’s profitability should interest policy makers.

Optus boss Kelly Bayer Rosmarin took aim at over-the-top service providers, the NBN and others “stripping profitability” out of the sector, and said government and policymakers should take a keener interest in the sector’s fortunes.

In a business outlook briefing on Monday, Bayer Rosmarin argued telecommunications is an essential service that is “highly valued by the community” but perhaps less so by policymakers.

“Structural shifts are stripping profitability out of the sector,” she said.

“[There’s] the NBN, the growth of the Tier 2 MVNO [mobile virtual network operator] market, and the over-the-top providers who contribute little if anything to the infrastructure they rely on, yet drive increased usage and continued investment for telecommunications infrastructure providers.”

Bayer Rosmarin said Optus’ investments in infrastructure at times felt “like trying to plant a seed in dry ground”.

“Return on invested capital in our sector is at historic lows,” she said.

“This is of concern to me and our investors, and it should also concern our government and everyday Australians too. 

“Investment in our sector has direct influence on the growth of our economy, the competitiveness of our businesses, and improved outcomes for Australians. 

“The current investment climate is not sustainable and risks holding back the future growth of our nation.”

Bayer Rosmarin said that as Optus “shifted gears” in its own market strategy, “I also believe there is a need to take stock and re-assess our current policy settings.” 

“We need to ensure these are highly tuned towards growing our industry and promoting the necessary investment and competition that can unlock the huge social and productivity benefits that our sector enables,” she said.

“If we can set policies that address the structural issues and deliver a level playing field, I’m optimistic that we can unlock the investment necessary in new technologies and infrastructure that are critical to fund productivity and growth in Australia.”

Bayer Rosmarin said that cost could be removed by getting more NBN services right the first time for the end user, and by reforming NBN Co's connectivity virtual circuit (CVC) charge, which most telcos want to see scrapped.

She also said that the ability for OTT providers to use less bandwidth, as evidenced by cooperation during Covid, meant the sector could act to aid telcos and could be asked to do so on an ongoing basis.

CX drive

Optus has spoken at reasonable length already this year on its customer experience (CX) ambitions, and Bayer Rosmarin confirmed today that the telco had extensive ambitions in this area of the business.

“Our vision at Optus is to become Australia’s most loved every day brand with lasting customer relationships,” Bayer Rosmarin said.

“This will take some serious shifts as becoming loved is not something we can take lightly. 

“We aim to know our customers so well and provide them with what they want, how they want it, maybe even before they realise they need it, to create ‘the Optus standard’ that means they will feel a sense of loss if they switch to anyone else.”

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