Telstra profit highlights high cost of fixed-to-mobile calls

A breakdown of Telstra's $2.6 billion record half-yearly profit highlights just how much consumers are paying in fixed-to-mobile calls – a component of our phone bills that receives little attention.

While the price of international, local and mobile call rates have fallen amidst fierce competition, fixed-to-mobile call charges have seen little movement, providing a lucrative revenue source for telcos. Telstra generated $3.6 billion revenue from phone access fees and all call charges of which fixed-to-mobile accounted for over $600 million.

Calling the UK now averages around 17 cents per minute, 24 hours a day yet fixed-to-mobile rates average around 30 cents a minute off-peak and 35 cents at peak times.

For many consumers, much more is spent on fixed-to-mobile calls than international or national calls, said PhoneChoice manager Lisa Pennell. “Consumers tend to focus on their international and local call costs and their network access fees. Little attention has been given to fixed-to-mobile rates and as such, prices really haven't changed very much at all. As a result, telcos obtain much higher profit margins for fixed-to-mobile and national calls.”

Consumers wishing to reduce their phone bill should examine the size of the fixed-to-mobile component and understand the way in which charges apply at different times of the day and between different telco providers.