Optus ending relationship with Woolworths Mobile – Woolworths investigating further options

Woolworths Mobile will no longer be able to sign up new customers to their Optus-supplied Mobile network as of tomorrow, with Optus advising that they are in the process of ending their relationship them.

The Woolworths Mobile service launched in July 2011, and has been supplying customers with fairly decent plans after purchase of a $2 SIM Card. An Optus spokesperson advised that from the 1st of October, customers will no longer be able to purchase a Woolworths Mobile prepaid SIM. Existing customers will not be immediately affected, with Optus advising that customers will be able to continue to recharge instore and online for another 12 months, after which time they will transition to purchasing Optus recharge vouchers.

Woolworths Mobile isn’t going away

Woolworths however, is not looking to end their Woolworths Mobile brand. A spokesperson advised Ausdroid, “Woolworths Mobile has been very popular with our customers. We have seen customer numbers double year on year since launch in 2011”. There are currently plans to find another network to supply Woolworths Mobile customers with service, with Woolworths advising “We are currently reviewing our options to ensure we can continue to offer a great value pre-paid service to our customers”.

Woolworths doesn’t seem worried about the immediate impact, their spokesperson adding “For the next 12 months, existing customers will not be impacted by this change and can continue to use Woolworths Mobile, with all the same benefits, features and inclusions”. Activation of new customers appears to be the only immediate issue, so it’s likely that Woolworths will announce something soon in regards to new plans or arrangements for new customers.

MVN No

The three major carriers have been slowly pulling back from supplying service to MVNOs (Mobile Virtual Network Operators). Earlier this year, Vodafone closed down the Crazy Johns brand in an effort to streamline their retail brand presence into a single cohesive brand. They also stopped supplying services to Red Bull Mobile this month, although the Red Bull Mobile site indicates that they’re concentrating on their other digital offerings. Vodafone do still offer services to other MVNOs such as GoTalk, HelloMobile and JustMobile, so they haven’t pulled back completely.

Telstra was the most recent carrier to shy away from the MVNO model, launching legal proceedings against ISPOne over unpaid invoices which eventually saw the network wholesale provider fold. Telstra began supplying service directly to Aldi Mobile, while they failed to reach a similar arrangement with Kogan Mobile.

The same collapse saw ISPOne spin off their Optus-supplied wholesale business into a new company – iBoss, which as of the 7th of September is owned and operated by CONCEC2 subsidiary AsiaPAC communications Group, who successfully purchased the assets of ispONE in a deal which included customers, staff and the billing platform. How long this business will remain feasible is unknown, with most Australian carriers seemingly souring on the MVNO market.

The Australian market definitely has a need and a market for MVNOs – who traditionally offer some great deals – but the question is, how long can they keep it up? At this stage, it’s understandable for both MVNOs and their customers to be fearful about the longevity of their existing business model. If Optus, Telstra or Vodafone – who own the network – start increasing the wholesale fees they currently pay, then these companies will be unable to compete on their lowest prices.

Are you currently connected Woolworths Mobile, or another MVNO? What led you to a smaller operator over the big three? Let us know in the comments.