Amaysim exits broadband market after 18 months

Amaysim will exit the fixed line broadband market after 18 months, blaming high wholesale costs and increased competition.

The telco has sold its customer base to regional telco specialist Southern Phone for $3 million, which will be migrated to the new platform next month.

As a result of the sale, Amaysim is expecting a non-cash impairment of approximately $7 million and will write down the carrying value of its broadband assets to zero.

Amaysim chief executive Peter O'Connell said the decision was made following a review into the broadband business, and was put down to "unsustainably high wholesale costs, intense competition and the need to allocate the company's capital appropriately."

"This transaction will enable the company to simplify its operating structure, defend and grow its core mobile and energy businesses, and invest in its technology platforms," O'Connell said.

"We will continue to explore additional products and services that we can offer to our significant mobile subscriber base. However, we will do this in a way that is profitable, delivers a great customer experience and aligns with our asset-light business model."

Amaysim announced it was entering the broadband market with NBN plans in July 2016 after acquiring ISP Australian Broadband Services (AusBBS) for $4 million, and started selling products the following year.

At the time, Amaysim said it would also invest another $3 million in developing and launching its fixed line products.

Last year also saw Amaysim enter the energy market when it bought online energy retailer Click Energy Group for $120 million to bundle electricity products with its mobile and fixed line plans.

Last month, Amaysim shut down its devices store less than a year after it launched in an attempt to simplify its operational structure.