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Amaysim CEO says 4G no ‘slam dunk’

The low-cost reseller is testing Optus 4G but isn’t ready to sell.

Amaysim is testing 4G services but is not certain customer demand exists for the faster wireless network technology, according to Amaysim CEO Rolf Hansen.

Amaysim, which launched two years ago, resells service on the Optus 3G network. Optus is steadily increasing its 4G coverage using LTE technology. Virgin Mobile, another MVNO on the Optus network, is already offering 4G plans.

“We’re certainly looking into offering [4G] over time,” Hansen told Computerworld Australia. “We’re even testing from a technical side, but it’s not a slam dunk in terms of the commercial proposition.

“I want to see how the network rollout evolves,” he said. “I want to see what commercial offering we get from Optus [and] if it makes sense for our customers.”

4G in Australia: The state of the nation

Amaysim has been doing well as a low-cost operator even without 4G services by selling BYO plans at prices lower than the competition. Its most expensive plan is $40 monthly and provides 4 GB data and unlimited voice and SMS.

“We’re approaching full profit in the next eight to ten months, depending on how much we want to invest in marketing.” Meanwhile, Amaysim is considering a move into the US and has had a team researching the market for the last six months, Hansen said.

“Yes, there is a certain part of the market that absolutely wants 4G,” Hansen said. But 4G coverage remains low at both Telstra and Optus, while 4G handset prices remain high, he said.

“There are quite some hurdles for the consumers to jump into 4G.

“We’re usually trying to serve the mass market,” Hansen said. “We’re very innovative in how we deploy the service or offer it. But low-cost mobile is focused on what makes sense to most people out there, because if you want to do things that makes sense to a few people, it’s initially very expensive.

“This mean we’re not everything to everyone."

In the past, Amaysim has moved quickly to meet customer demand. When the Apple iPhone 5 launched requiring Nano SIM cards, Amaysim had a problem because it only offered larger SIM and Micro SIM cards.

With only four days to launch, Amaysim went to Airtasker to get help hand-cutting its existing SIM cards into Nano SIMs. The company sent its chief operating officer to the Apple store on launch day to get one of the new phones, tested the DIY Nano SIM and discovered the solution worked.

“We’ve shipped out thousands since the iPhone 5 launched without officially having them,” Hansen said. “We still haven’t received any official Nano SIM shipments.”

While Vodafone Hutchison lately has been particularly effusive claiming competitive problems in Australia, Hansen appeared upbeat about Amaysim’s ability to compete with giants like Telstra.

“Australia is far away from everything else and it has a tradition of two or three big players sharing the cake amongst them, be it banks, insurance companies or telcos,” Hansen said. However, in other industries, upstart brands like ING have entered the market and begun changing its structure, he said.

“Since we’ve entered the market, a lot more real competition has started,” Hansen said. “The market is certainly regulated in a way that allows for competition.

“Yes, there’s some dominant players out there", but Amaysim hasn’t been affected by Telstra’s dominance in the fixed-line market, he said. “We play a different game on a different field.”

True, Nano SIMs arrived at other telcos’ doors before Amaysim, he said. “But then, there’s ways around [that].”

Follow Adam Bender on Twitter: @WatchAdam

Follow Computerworld Australia on Twitter: @ComputerworldAU, or take part in the Computerworld conversation on LinkedIn: Computerworld Australia

Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.

More about: Airtasker, Apple, Hutchison, ING, Optus, Telstra, Virgin Mobile, Vodafone
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Tags: lte, Australia, Rolf Hansen, optus, Telstra, competition, Vodafone Hutchison Australia, CEO, amaysim, 3g, 4g, MVNO
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