Vodafone targets Telstra customers

VODAFONE'S underperforming Australian operation is preparing a new range of pricing plans targeting market giant Telstra's A$8bn (£3.3bn) revenues from fixed-line operations.

The telecoms operator, which has announced discounts in recent weeks, is expected to reveal further changes to its pricing structure next week, with analysts predicting it will keep pursuing the discounted and prepaid model that may lure Telstra's fixed-line customers.

Leading telecoms analyst Paul Budde said: 'They are in a desperate situation and need to do something because they are running out of time.

'The problem is they are No 3 in the sector by a mile and the Hutchison 3G launch has hit them just as they were starting to grow again.'

Budde said Vodafone, which has about 18% of the Australian mobiles market, had realised that subscriber growth had slowed and the best chance of growing the business was through increased volumes, which meant discounting.

Discounts of up to 20% on Telstra's current fixed-line charges would attract many customers, claimed Budde, but he doubted that could be profitable to Vodafone unless it kept pursuing efficiencies.