No cash, no discounts: What Optus boss Kelly Bayer Rosmarin told global investors

LISTEN | Kelly Bayer Rosmarin told a private briefing the telco wouldn’t pay compensation because customers wanted something meaningful following the outage.

Optus suffered a massive outage of its mobile network last week. Picture: NCA NewsWire / Flavio Brancaleone

Optus’ customers don’t want a cash refund to the equivalent of $1.60 each and the Singapore-backed telco has no intention of offering discounts following last week’s massive network outage.

These are among the messages Optus chief Kelly Bayer Rosmarin delivered during a private briefing to global investors the day after her telco’s network went down for more than 10 hours, sparking the ire of millions of Australians.

Ms Bayer Rosmarin, who is scheduled to front a parliamentary committee in Canberra on Friday, also dismissed the prospect that Optus could face penalties for the outage that also impacted the Triple-zero emergency service.

“Of course nobody has an outage like that on purpose, so I think it’s just premature to even speculate in that direction,” Ms Bayer Rosmarin said, according to a recording of the briefing.

Earlier on Wednesday, Optus blamed the international network belonging to its parent Singapore Telecommunications for the nationwide meltdown.

The crash cut off almost 40 per cent of Australia’s population from phone and internet services and brought some businesses to a standstill. Some Australians could not even dial triple-zero on fixed lines. Optus has since offered customers the equivalent of more than $100 in free data, or 200GB for eligible postpaid customers.

Speaking to Singapore based investors during Singtel’s first half profit briefing, Ms Bayer Rosmarin knocked back suggestions customers should get cash returns as compensation for the crash.

“I just want to explain that we’re not talking about direct compensation because if you took an average customer on a $49 plan, and they didn’t have service for a day, that would equate to about $1.60, and we don’t think that’s what customers want, is a credit for $1.60”.

“We’re looking at what we can do to make our customers feel like they’ve been heard, that they know that we care, that we understand that we let them down and to try and give them something more valuable.”

Millions of Australians were left without phone and internet services. Picture: NCA Newswire /Gaye Gerard

She acknowledged that businesses rely on Optus’s connectivity to “build profits” and said the free data offer was more a “gesture of goodwill”.

“Obviously, it’s devastating for some businesses that they weren’t able to do what they normally do. Many businesses have contingency plans in place. And they were still able to move forward. That’s a very case-by-case scenario”.

Analysts at pan-Asian investment bank Maybank said Optus could be forced to pay up to $400m under an agreement with Australia’s communications regulator. This would equate to about 10 per cent of its half-year revenue.

Optus CEO Kelly Bayer Rosmarin.

Maybank based its calculations on the compensation Telstra paid customers following an outage in 2016, which involved a $25 credit for consumers and $50 credit for businesses.

But Ms Bayer Rosmarin told analysts that Optus’s offer gave its customers more value than Telstra’s.

“It may not be exactly the same as the gesture that Telstra gave a few years ago or some other competitors do, but we’re looking at what we can do that would be meaningful and valuable to our customers”.

Still, Maybank is expecting customers to leave Optus for Telstra and smaller TPG Telecom. But Ms Bayer Rosmarin has rejected any suggestion there would be an exodus, highlighting the telco’s past reliability.

“There was a huge fallout from this cyberattack, and the team spent the time apologising for customers, put in place marketing messages that we knew were tried and tested and resonated and building back trust. And as a result, we could see an improvement in our brand sentiment,” Ms Bayer Rosmarin said.

“I don’t think there’s any big strategic shifts that are going to come out of what we experienced (last Wednesday). It was a very unfortunate outage”.

“Our focus has, is, and always will be on providing a resilient and robust network. So that aspect is not going to change. Hopefully, most of our customers know how even though we let them down yesterday how resilient we’ve been every other day, and we’re going to hope to prove that to them ongoing into the future”.

The Optus boss also said there were no plans to use discounting to protect the telcos market share in the wake of the massive outage.

“I think what you were actually asking is are you expecting us to abandon reason and start discounting heavily, and I would say that’s – if that’s what you were trying to get at, we remain very committed, as we have been always, to profitable, sustainable growth and delivering great value for our customers,” she told the briefing.

“Great value is not just about giving an excellent price, but it’s also about providing a very good service and unique differentiators,” she said.

“That is our strategy and as horrible as (last Wednesday) was, and as much as we let our customers down, and we’ll do everything we can to make up for it, at this stage I don’t see us completely abandoning a strategy that we’ve been committed to.”

Originally published as No cash, no discounts: What Optus boss Kelly Bayer Rosmarin told global investors