Government to Investigate Massive Optus Outage, Expects Compensation for Consumers

Optus' "Yes" sign reflects in its outlet window in Sydney, Australia, on Nov. 8, 2023. Saeed Khan/AFP via Getty Images

The Australian government has ordered a review into the Optus blackout that resulted in millions losing their mobile connection for hours on Nov. 10, with the telco now staring down the barrel of compensating customers and businesses.

“While we welcome that Optus services were restored over the course of the day, it is critical the government conducts a process to identify lessons to be learned from yesterday’s outage,” said Communications Minister Michelle Rowland, in a statement.

“I will task my department with developing the terms of reference for a post-incident review. Further announcements around the terms of reference and next steps will be made in due course.”

At the same time, the minister said the Australian Communications and Media Authority (ACMA) would also assess whether the telco complied with the rules around emergency calls during the outage.

Customers of Optus lost their mobile phone and internet services for over 12 hours on the day, causing major disruption to businesses, and government services.

Around ten million consumers were unable to make phone calls or send messages from 4 a.m., while tens of thousands of businesses could not use EFTPOS (electronic funds transfer at point of sale) services to process payments for their customers.

ATM and other essential services such as public transport, hospital, and emergency services were also affected.

While Optus has “sincerely” apologised to consumers, the company so far has not provided a clear explanation about why the outage occurred.

Optus CEO Kelly Bayer Rosmarin told the media that a “technical network fault” was responsible for the incident but did not explain what it was.

Government Expects Optus to Compensate Customers

In an interview with ABC News, Ms. Rowland believed it was reasonable for Australian consumers to receive compensation from Optus for their losses.

“I think there is a reasonable expectation from Australians that if they are done wrong, if there is an outage of this nature that causes them to suffer loss in some way, be that economic or otherwise, that corporations will do the right thing by them,” she said.

“But aside from that, the ACMA has pointed out that some contracts may entitle customers to refunds or rebates and that the Australian Consumer Law may operate here.”

A Optus service message is displayed on a phone outside an Optus store in Sydney, Australia, on Oct. 5, 2022. Brendon Thorne/Getty Images

The Telecommunications Industry Ombudsman has urged affected businesses to keep evidence of their losses (receipts) and reach out to Optus to discuss compensation.

“What we would encourage you to do is contact Optus and ... help them understand what the impact was on them and their earnings,” Ombudsman Cynthia Gebert said.

“That’s the sort of thing that we think you need to tell Optus so they get a sense of what sort of compensation might be the right thing to do for your circumstances.”

While the government has not been able to figure out the amount of financial loss incurred by the outage, it believes the impact was significant.

“I expect a significant impact on small business, everything from, you know, flower shops to Uber drivers who have been impacted by it, and of course, you know, the risks associated with that for consumers as well. Reports that 000 calls were unable to be made from landlines, etc.,” Assistant Treasurer Stephen Jones said.

“There are significant and far-reaching consequences, not just economic, arising from this outage.”

Meanwhile, Optus has declared a refund would not be enough to compensate for the severity of the situation.

Ms. Rosmarin said each consumer would get less than $2 (US$1.3) if the company refunded them. The CEO then suggested other forms of “valuable reward” for loyal customers.

“We are going to look at how we reward our customers for their loyalty and patience,” she told the Herald Sun newspaper.

“We might choose to do something that is more valuable.”