July's Telstra outage cost Australia $500m, modelling shows

A single Telstra outage in July cost the Australian economy over half a billion dollars, according to economic modelling released last week.

Early on the morning of 8 July 2026, a fault in a timing device caused a nationwide outage of Telstra’s mobile network. For around 12 hours, calls and data were disrupted across Australia. At the peak of the outage, 45% of all calls and data sessions were affected, and up to 8.8 million users were impacted. Some people could not reach Triple Zero, regional trains in Victoria stopped running, and small businesses could not process payments.

FTI Consulting was engaged by the Australian Communications Consumer Action Network (ACCAN) to estimate the economic costs of the outage, recognising impacts beyond direct service disruption and including broader economic effects. The purpose of the report was to provide an evidence base to support policy discussions relating to telecommunications reliability.

The report estimated a potential economy-wide impact of $552 million in value-added terms; this measures the net cost of the outage on the Australian economy’s total output in terms of contribution to gross domestic product (GDP). This estimated total economic cost includes approximately $302 million of direct economic losses, based on time lost and other disruption-related impacts arising from the outage.

FTI Consulting noted that the report takes a deliberately conservative approach “due to data limitations regarding the outage”, saying its figures should be considered as a “lower bound estimate”. It is expected that a range of other impacts occurred that are unable to be quantified but were still significant to consumers and businesses. Furthermore, the report does not consider the more pronounced impacts likely to be felt across regions that are more reliant on Telstra as their sole provider.

At Telstra’s Annual General Meeting last week, Chairman Craig Dunn revealed the company had received 33,000 complaints following the outage and that it had paid out about $1 million in compensation. CEO Vicki Brady also had her pay package reduced by $607,000 for 2025–26, while the short-term incentive pay of nine other senior executives was docked by a total of $1.3 million. But according to ACCAN CEO Carol Bennett, this is clearly insufficient when considering the outage’s cost to the Australian economy.

“Outages are far more than an inconvenience,” Bennett said. “One outage cost this economy over half a billion dollars, but the telco at fault didn’t foot the bill. Australian households and small businesses did.

“Since April 1 this year, Optus has had 97 outages and Telstra has had 322. Outages are a drain on our economy, and they put public safety at risk.”

The report was released just days before the passage of the Telecommunications Legislation Amendment (Universal Outdoor Mobile Obligation) Bill 2026, which among other things allows the Minister for Communications to determine standards, benchmarks and rules mobile service operators must meet to ensure they deliver quality and reliable services to Australians. But amendments to introduce enforceable standards were ultimately voted down, much to Bennett’s disappointment.

“Mobile networks are the only essential service in Australia without enforceable reliability and performance requirements,” she said. “Best-efforts commitments from this sector have failed again and again. Australians deserve standards that require telcos to properly resource and govern the networks we all depend on.”

Image credit: iStock.com/Jutharat Pinpan