Australian telcomms battle for Internet business

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SYDNEY -- OzEmail, Australia's largest Internet company, has switched providers, moving from Telstra, the country's largest telecommunications company, to rival Optus Communications, pushing Optus's share of the Australian market to about 50%. The move signals a fight between the carriers for the nation's 500 or more Internet service providers, most of whom currently use Telstra.

The catalyst for OzEmail's move from Telstra's Big Pond service was Optus's entry into the Internet wholesale business with a service called Spinnaker, launched last week. Optus has also won the Internet business of Australia's 37 universities as well as the federal government's large Commonwealth Scientific and Industrial Research Organisation.

Optus won the new business by acknowledging that higher Internet traffic warrants cheaper charges and that domestic traffic costs less to transmit, claimed Andrew Bailey, Optus's director of industry services. The savings through Optus on Telstra charges are about 30%, he says.

Copyright December 1997, Crain Communications Inc.

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