ISP prices to go up as providers focus on profitability: MyNetFone

Telecommunications provider warns of looming price increases for ISP services

Consumers will continue to pay more for mobile and wireless services as ISPs will push up prices to increase profitability.

MyNetFone CEO, Rene Sugo, said a lot of providers were trying to put more value in their bundles to justify the price rises.

“The question will be how will consumers take it,” he said.

“Will they stick with what they know, or will they go for basic non-bundled offers from a mainstream provider, in combination with separate value-added providers’ OTT [“over-the-top”] services?”

With several value-added services and new features consistently coming into the market, Sugo expects traditional providers to struggle to integrate them into their plans and billing systems.

“In 2013, we’re really seeing the rise of OTT providers delivering additional functionality,” he said.

A "faster than anticipated" level of market consolidation in the ISP space last year is fuelling the drive to increase monthly charges to consumers.

Sugo said this wasn't surprising.

“It seems that costs to customers have actually gone up, rather than down in the second half of 2012,” he said.

Sugo said this is after two years of significant year-on-year price declines.

“This has now spread to the mobile world, with all three mobile carriers decreasing the value of their plans and bundles, which effectively means putting the ‘per unit’ price up,” he said.

SMB focus

The strategy for MyNetFone coming into 2013 will be to focus on expanding the provider’s SMB services.

Sugo said the company’s goal is to become a “one-stop comms shop” for the Australian SMB market.

“This involves developing additional features for our hosted voice and data communications, such as email, web, domain names, in addition to the phone systems and virtual fax that we currently offer,” he said.

Patrick Budmar covers consumer and enterprise technology breaking news for IDG Communications. Follow Patrick on Twitter at @patrick_budmar.

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