Telstra’s nationwide cell outage in July wiped an estimated $552 million from the Australian financial system, in response to new modelling that shopper advocates will put earlier than senators this week.
The estimate, seen by this masthead, was ready by FTI Consulting for the Australian Communications Shopper Motion Community. It’s greater than 500 occasions what Telstra has paid out in compensation.
Telstra mentioned it had acquired about 33,000 complaints and compensation claims, had resolved 99 per cent of them and had paid out about $1 million.
ACCAN chief government Carol Bennett mentioned households and small companies had carried the fee. “One outage price this financial system over half a billion {dollars}, however the telco at fault didn’t foot the invoice,” she mentioned.
“Australian households and small companies did.”
“Persons are paying a premium for Telstra providers within the perception that they’re getting higher protection, higher service, higher reliability, and none of these issues apply on this occasion,” Bennett instructed this masthead.
Telstra mentioned it had not seen the analysis. “On the face of it they seem to depend on a variety of assumptions about broader financial impacts that don’t replicate the character or length of the outage and considerably overstate its financial impact,” a Telstra spokesman mentioned.
FTI mentioned consulting Telstra to check its assumptions had been outdoors the scope of its work. Bennett described the estimate as “grossly conservative”.
Telstra chair Craig Dunn instructed shareholders on the firm’s annual assembly on Tuesday that the outage “shouldn’t have occurred”.
The outage started at 2.50am on July 8, when a GPS card in a Melbourne tools room reset after an influence provide was changed and instructed the community the date was 2006. Greater than 8 million Australians couldn’t make calls or use cell knowledge, in response to the FTI report. A whole bunch of Triple Zero calls failed and regional trains in Victoria and NSW stopped.
FTI estimated the outage’s direct prices at about $130 million, excluding misplaced leisure time and unpaid wages. Fed into an financial mannequin, that turned a $302 million hit to output, and $552 million in misplaced gross home product as soon as flow-on results had been counted.
Misplaced enterprise productiveness was the most important single price, at $104.2 million.
FTI calculated that determine would have been $39 million if each employee had misplaced quarter-hour, and $310 million if all had misplaced two hours.
It additionally described its findings as a conservative decrease certain that overlooked rail freight and the heavier toll in areas the place Telstra is the one supplier. Telstra instructed a Senate inquiry in December it had recorded 5221 cell tower outages lasting greater than 10 minutes in these areas in 2025.
The Australian Communications and Media Authority (ACMA) mentioned its investigation into whether or not Telstra met its obligations was ongoing, and it couldn’t say when it could end. It might search penalties of as much as $30 million per breach, although an investigation doesn’t imply the regulator has fashioned a view that the legislation has been damaged.
The Telecommunications Business Ombudsman has acquired 397 complaints in regards to the outage. ACCAN and different shopper teams need it to raise its $1500 cap on compensation for non-financial loss to about $15,000, and the ombudsman mentioned it was reviewing the cap.
A spokesperson for Communications Minister Anika Wells mentioned telcos had been anticipated to ship “honest, expedited and environment friendly compensation”, however didn’t deal with the modelling.
The modelling comes because the Senate debates the Common Out of doors Cellular Obligation invoice on Tuesday, which might give the communications minister energy to make reliability requirements for cell networks.
ACCAN needs the invoice amended to make these requirements enforceable and to introduce home roaming, which might let Australians change to a rival community when their very own fails.
“Cellular networks are the one important service in Australia with out enforceable reliability and efficiency necessities,” Bennett mentioned.
Dunn argued in opposition to mandated roaming, saying it “doesn’t construct a single new cell tower” and would make it tougher to justify regional funding. The Telstra’s chairman mentioned emergency calls already switched to any accessible community, so roaming “would haven’t any impression on entry to Triple Zero”.
Opposition communications spokeswoman Sarah Henderson mentioned the Coalition’s amendments would make sure the findings of the competitors watchdog’s inquiry into cell providers, together with roaming, had been correctly thought of. That inquiry is because of report subsequent 12 months.
“The ACCC has expressed concern about declining regional telco funding and it could be irresponsible to ignore its very important inquiry together with into cell roaming,” Henderson mentioned. “The price of community outages to the financial system is alarming.”
Bennett mentioned ready for the ACCC would delay reliability requirements by a minimum of a 12 months.
“Senators now have a security case, an financial case and a yearlong Senate inquiry which all level the identical method,” she mentioned. “The laws is earlier than them this week, and they need to act.”
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David Swan is the expertise editor for The Age and The Sydney Morning Herald. He was beforehand expertise editor for The Australian newspaper.Join by way of X or e-mail.