Telecommunications giant Optus is bracing for a potential wave of compensation claims from businesses and consumers impacted by the recent nationwide outage.
Latest headache for telco
This is just the latest hit to the company’s brand following a major cyber attack in September 2022 in which more than 2 million customers had their personal data compromised by hackers.
In response to this latest incident, which saw Optus customers unable to use the service for some hours, the Australian Government has announced a public review and a separate investigation by the Australian Communications and Media Authority (ACMA) into the company's handling of the outage.
Communications Minister Michelle Rowland revealed the government's intention to conduct a post-incident telecommunications review, focusing on the technical nature of the fault, mitigation strategies and broader sector implications.
ACMA's investigation will train its attention on Optus' failure to maintain access to emergency services (000) during the outage.
The outage, which affected more than 10 million customers and 400,000 businesses, coincided with Optus' release of its half-year financial results, reporting a 14% decline in earnings before interest and taxation (EBIT) to $141 million.
The company cited challenges arising from weak consumer sentiment and inflationary pressures.
Assistant Treasurer and Finance Minister Stephen Jones emphasised the need for compensation for affected Optus customers, particularly small businesses that suffered losses due to the outage.
He called Optus out for its communication approach during the crisis and stressed the company's responsibility in handling such situations.
Apologies and potential compensation
Optus has issued apologies for the disruption and expressed its commitment to cooperating with the government reviews.
The company is also evaluating potential compensation measures for impacted customers.
Optus faces the challenge of rebuilding trust among its user base and demonstrating a robust response to prevent future disruptions.
The outcome of the reviews could have significant implications for Optus and telcos more broadly, including the potential for compensation claims and the need to address any crisis response issues and communication procedures.
Telecommunications critical
The outage highlights the now-critical nature of the telecommunications landscape for Australian consumers and businesses, emphasising the need for network reliability and responsiveness.
Businesses and consumers now rely on smartphones and devices for nearly every transaction imaginable.
The reliability of emergency services like 000 is paramount, and any breaches of obligations in this regard will likely prompt regulatory actions and reforms.