Telstra tells 65% of post-paid mobile customers to expect price hikes from September

The cost of post-paid mobile plans will rise for most Telstra customers from next month, the telco giant has confirmed, putting new pressure on consumers and small businesses already faced with surging inflation.

In its FY22 report, delivered Thursday, the nation’s largest telecommunications company reflected on its July price hike, which was linked to growing Consumer Price Index (CPI) readings.

At the time, Telstra also “introduced an option to review prices annually against CPI”, the company said.

With the latest CPI reading showing 6.1% growth over the year to June, this means the bulk of Telstra post-paid mobile customers can expect a larger bill in the weeks to come.

“This results in increased prices for around 65% of postpaid mobile customers, and will flow through from September,” the company said.

“Different dynamics” are impacting the remaining 35% of postpaid customers, the telco added, with pricing reviews ongoing across the brand’s portfolio.

Product income from mobiles grew 1.7% over the year to $9.47 billion, Telstra said, with revenue growing 6.4%.

All told, Telstra’s net profits after tax hit $1.8 billion in the financial year.

That marked a 4.6% downturn from FY21 levels, with Telstra acknowledging a significant drop-off in one-off NBN expenses.

To counteract that slide, CEO Andrew Penn told investors the company has “revenue levers” at its disposal — with inflation-based price hikes among them.

“As I mentioned earlier, we have increased prices reflecting CPI in mass market branded mobile and our nbn recurring revenues of around $1b are indexed to CPI,” he said.

“We’re also looking at what increasing costs means for other pricing.”

While mobile price hikes are likely to have households and small businesses considering their options, increased competition has already shaken the broadband market.

In May, an NBN wholesale market report from the Australian Competition and Consumer Commission (ACCC) revealed Telstra’s dominant market share had dipped by 0.3%.

That decline was chalked up to increasing competition in the sector, with ACCC commissioner Anna Brakey declaring sharp pricing and new offers were keeping massive players “on their toes”.