It’s been turmoil in the telecommunications space after Optus revealed hackers had taken off with the personal data of nearly 10 million Australians last week. But the incident could have brought a silver lining for Telstra Corporation Ltd (ASX: TLS) shares.
Experts have reportedly voiced concerns the hack could cause Optus’ market share to shift. Of course, that could be good news for Telstra.
The company holds the majority share of the Aussie telco market, with Optus generally coming in second.
Stock in the national carrier is currently trading at $3.87.
Let’s take a closer look at what the Optus breach could mean for its S&P/ASX 200 Index (ASX: XJO) competitor.
Could Optus’ suffering benefit Telstra shares?
Telstra shares could ultimately benefit from a hack – and a potential resulting hit to Optus’ reputation – that saw the data of 9.8 million current and former Optus customers reportedly ransomed by hackers.
Analysts at S&P Global have reportedly said Optus customers could end up ditching the telco following the drama. They said, courtesy of The Australian:
The longer-term reputational impact of the breach remains a rating focus. This includes how it will affect Optus’s market share and its ability to sustain its pricing and average revenue per user.
A key influence on this will be customer perceptions of the adequacy of Optus’s response and the extent to which investigations reveal any fundamental flaws in the group’s cybersecurity systems and governance practices. We believe Optus’s customer base will have limited tolerance for any material subsequent data breaches, thereby increasing franchise risks relative to peers if it happens again.
A shift in market share could also benefit Telstra’s fellow ASX 200 telco TPG Telecom Ltd (ASX: TPG).
Optus notified customers of the cybersecurity attack last Thursday.
The company is offering a 12-month Equifax Protect subscription to its most affected customers. It’s also working with state and territory governments to wave or provide a credit equivalent of fees charged to those replacing exposed driver’s licences.
The Telstra share price has traded close to the S&P/ASX 200 Communications Index (AS:X XTJ) over the last week.
After falling 1.8% on Friday, it has gained almost 3% so far this week. Meanwhile, the sector dumped 2.6% last Friday and has lifted 2.6% since.
The post Could Telstra shares be set to benefit from the Optus hack? appeared first on The Motley Fool Australia.
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More reading
- Telstra share price lower amid ACCC update on TPG agreement
- Looking to buy Telstra shares but worried about an Optus-style hack? Read this
- Own ASX 200 telco shares? Here’s the latest following the Optus hack
- Here are the top 10 ASX 200 shares today
- Why is everyone talking about pricing power and which ASX shares have it?
Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Telstra Corporation Limited. The Motley Fool Australia has recommended TPG Telecom Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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