Key Points
- This week, Telstra notified customers of price rises across all of its postpaid plans.
- Optus and Vodafone have also increased prices in recent months, citing inflation and operational costs.
- Other household bills such as energy, rent and food are all rising amid the cost of living crisis.
As Australians continue to grapple with , phone bills are the latest price hike hurting our hip pockets.
In the past 12 months, customers of Australia's three major telecommunications companies - Telstra, Optus and Vodafone - have all been hit with price rises for mobile phone plans.
Telecommunications companies are citing surging inflation and rising operating costs, but is it fair for customers to pay the price?
Telstra, Vodafone, and Optus increase plan prices
In 2022 Optus announced price rises, while in late February TPG Telecom - the operator of Vodafone - announced postpaid plans would be increasing by $5 a month from April.
Many existing customers are receiving an increase in their monthly data allowance.
This week, Telstra notified customers of a price rise across postpaid plans, which will come into effect from 4 July.
Starter and Bundle plans will increase by $3 each per month, while Basic and Essential plans will go up by $4, and Premium plans will rise by $6.
Basic and Bundle plans will receive an extra 10GB of data.
Mariam Gabaji, telco expert at financial comparison site Finder, said for many customers struggling to pay bills, an increase in data would not mitigate the rising costs.
"These price hikes are about $2 to $5 a month, which might not sound like a lot in the short term but it all adds up in the long run," she said.
Optus, Vodafone and Telstra have all increased prices in the last 12 months. Source: AAP / Bianca De Marchi
"Telcos are justifying this by offering more data in return, but if the data is more than you need, it might not be worth paying for."
Why are phone prices rising?
A spokesperson for TPG Telecom and Vodafone told SBS News the company's decision was made in response to inflationary pressures and the rising costs of doing business.
"This was the first time Vodafone has increased pricing for its existing postpaid mobile customers in at least 10 years and is not a decision we have taken lightly," the spokesperson said.
Telstra's financial results report for the 2022 financial year show the company recorded a profit of $1.8 billion.
Over the same period, Singtel – which operates Optus – recorded a net profit of S$1.92 billion ($2.14 billion).
According to TPG's 2022 annual report, the company made a net profit of $513 million.
In May, the federal government's Australian Communications and Media Authority (ACMA) released its , which found almost 2.4 million Australians experienced difficulty paying or had concerns with their telco bills in the past 12 months.
ACMA said the industry was letting down customers who were experiencing financial hardship.
The Australian Communications and Media Authority says telecommunications companies are letting down mobile phone users. Source: Getty / Jackyenjoyphotography
When compared with other service providers, such as water and electricity, telcos were seen as less flexible, less well-equipped, and with fewer assistance options.
How can you reduce your phone bill?
If you're struggling to afford your phone bill, Ms Gabaji recommends shopping around and looking into smaller telco companies.
"There is no shortage of providers offering plans to meet different budgets," she said.
"It's one of the easiest household bills to stay on top of, so regardless of the changes your provider is making, just compare your options."
If you're locked into a postpaid plan on a contract, Ms Gabaji advises paying off the remaining cost of the phone if possible, and switching to a SIM-only plan with a cheaper provider.
If paying off the phone isn't possible, she recommends asking the provider whether there is a cheaper plan available.
For customers experiencing financial hardship, major telcos offer dedicated support services.
Optus support offers options that include reviewing the customer's phone plan and needs, restricting services if necessary, and waiving or placing a temporary hold on late payments. The company also recommends opting for Choice plans, which offer flexibility in selecting data, roaming, and device payment options.
Through Telstra, customers can access a top-up program that provides a complimentary $40 mobile credit recharge to those who are experiencing or at risk of homelessness, family violence, or impacted by natural disaster.
Vodafone customers experiencing financial hardship can access a $10 Stay Connected plan, as well as crediting or waiving of debt if appropriate, implementation of a pre-payment functionality, and assessment and support from a specialist team.
What can the government do to help?
When it comes to government support, Ms Gabaji says the government should provide consumers with advice on different mobile networks and price points.
"I think that's the best thing the government can do for people who might not be able to get online and search for options; just passing on that information in other mediums," she said.
"We know how complicated energy can be, and they're pushing people to shop around and compare options, I think if they did that for different household bills as well, including mobile plans, that could go a long way."
