CommsDay Story of the Week – from CommsDay Issues of 31 March and 1 April 2026
This week’s CommsDay Story of the Week spreads across two articles. The first article, published on 31 March, covered a Venture Insight report on the problems encountered by mobile operators all of whom have recently made substantial investments in their networks and all of whom are being challenged to achieve a rate of return above their cost of capital. With little growth in the market the operators have increased their prices, especially for lower value packages. In 2025 TelSoc conducted a webinar in which Professor William Webb presented on the same issues – but with a worldwide canvas. He particularly blamed poor investment returns on 5G. The second article, published on 1 April, reported on the price increases announced by Optus, following Telstra’s lead.
Mobile price increases reflect returns gap to cost of capital: analyst report (1st article)
Recent mobile price increases led by Telstra reflect a structural gap between industry returns and the cost of capital, according to a new report by Venture Insights managing director David Kennedy.
The report argued the Australian mobile sector has been generating returns below its weighted average cost of capital of around 8.3%, with only Telstra “barely” meeting that threshold while Optus and TPG Telecom have consistently underperformed.
Kennedy characterised the sector as being caught in a “capital trap”, where high and ongoing investment requirements are not matched by sufficient returns.
Within that context, the latest round of mobile price increases was framed as a structural response to restore returns rather than a discretionary pricing move, with the report pointing to a multi-year repricing cycle across all three mobile network operators. It said capital intensity remains elevated, with operators spending around 18% to 23% of service revenue on network investment, alongside rising spectrum costs and broader input pressures.
The shift away from CPI-linked pricing was also identified as a key factor, enabling operators to adjust prices in line with investment needs rather than inflation.
The report said the alignment of pricing movements across Telstra, Optus and Vodafone reϐlected a focus on restoring returns rather than aggressive price competition. “Price increases are no longer occasional anomalies but have become a fixed feature of the landscape,” it said.
The report warned that failure to lift returns above the cost of capital would risk slower rollout of advanced mobile technologies, reduced spending on network resilience and security, and weaker regional investment.
It also pointed to balance sheet actions such as asset sales and write-downs as evidence of sustained pressure from sub-WACC returns. While acknowledging consumer sensitivity to rising bills, the report argued the current phase reflects a reset after a prolonged period of real price declines, with mobile pricing being recalibrated to better reflect underlying economics.
Grahame Lynch
Optus lifts key plan prices following Telstra move (2nd article)
Optus will increase prices on two of its most widely used postpaid mobile plans from May, following price changes announced by Telstra last week.
The operator said it will lift monthly charges by $5 on its Choice and Choice Plus plans, with the changes taking effect from 18 May.
CommsDay understands the two plans account for around a quarter of Optus’ roughly 10 million mobile services.
Customers will begin receiving notifications from today. Optus said it will provide at least 30 days’ notice and offer support options, including for those experiencing financial hardship.
The increase will be accompanied by additional data inclusions ranging from 10GB to 80GB per month depending on the plan tier.
The move follows Telstra outlining increases across most of its postpaid and pre-paid mobile portfolio from 5 May, with typical postpaid plans rising by $4 per month and prepaid recharges increasing by around $5. As with Optus, the revisions include higher data allowances bundled into updated offers.
Data from the Australian Bureau of Statistics shows telecommunications prices have fallen by around 20% since 2015, even as usage and service quality have increased. Average increases across Optus’ mobile plans equate to roughly 13% over the past 12 months compared with around 12% for Telstra, with Optus’ comparable offers remaining lower in absolute dollar terms.
The pricing moves came a day after Venture Insights published analysis finding the Australian mobile sector generates returns below its weighted average cost of capital of around 8.3%, with Telstra only marginally meeting that benchmark and Optus and TPG Telecom consistently below it.
The report characterised the sector as being in a “capital trap”, where sustained investment requirements in networks, spectrum and capacity have not been matched by sufficient revenue growth.
Grahame Lynch
IN TODAY’S COMMSDAY (Thursday 2 April 2026)
Stockland has filed plans for a $3.95 billion Western Sydney data centre. The facility in Aldington Road, Kemps Creek, will comprise 12 data halls and has an anticipated power consumption of 226-245MW.
Starlink has launched an aggressive promo pricing campaign ahead of the expected launch later this year of Amazon’s LEOsat broadband service in Australia. Starlink yesterday announced discounts across its line-up of three residential plans, with the service now available from $49 for its Residential 100Mbps service.
Nokia has restructured its regional leadership across Asia Pacific and Oceania, with Andrew Cope moving into a broader Asia Pacific role and Adrian Heley appointed to lead the vendor’s Oceania operations.
Telcos are facing “everything everywhere all at once” as operators contend with rising capital demands, intensifying competition and structural pressure on returns, according to Kearney chairman emeritus and former global CEO Alex Liu.
The Australian Competition and Consumer Commission has shifted its assessment of NBN Co’s multi-billion-dollar expenditure program away from a broad judgement of whether investment is reasonable, toward a more forensic test of what caused that investment to occur when it did, reflecting the influence of a four-part review by economic consultancy HoustonKemp commissioned by the regulator.
The telecommunications sector has delivered a disproportionate contribution to Australia’s productivity growth but is facing mounting structural constraints including regulatory burden, access to key inputs and fragmented infrastructure approval regimes, the Australian Telecommunications Alliance said.
The US has flagged Australian laws governing streaming services, news content, digital competition and restricting social media access as having the potential to create trade barriers and put US companies at a disadvantage.
The Australian Communications Consumer Action Network has called on the federal government to remake and expand the Customer Service Guarantee, arguing the long-standing consumer protection framework is failing to deliver meaningful outcomes.
US-based AI pioneer Anthropic will explore investments in data centre infrastructure and energy generation across Australia as part of a memorandum of understanding reached with the federal government involving collaboration on AI safety and research.
Nvidia has invested US$2 billion in Marvell Technologies as part of a broader plan to integrate advanced optical networking capabilities into its artificial intelligence infrastructure solutions.
Low Earth orbit satellite systems are emerging as a complementary positioning, navigation and timing layer as global navigation satellite system vulnerabilities intensify, according to a new report from FrontierSI.
Huawei reported CNY880.9bn (US$128bn) in revenue and CNY68bn (US$9.9bn) in net profit for 2025, stating performance was in line with forecast.
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