I think one of the main reasons it strong oversight of the sector by both the ACCC and Telecommunications watchdog.
It took a long time to force this, but aggressive competition by regional ISPs (especially Internode and iiNet) forced Telstra to allow access to their ADSL network, and once that was in these and other companies used similar tactics to force open other markets.
Optus aggressively used MVNOs to build market share in mobile markets, and while Telstra still charges a premium the generally decent quality Optus network has kept a cap on how much additional they can charge.
I would suspect genuine regulated competition is the correct answer here (as you spell out). This is in contrast to the monopolies and corruption seen elsewhere. The customer service is still horrible, and NBN remains a disaster.
The independent ISPs (especially Internode and iiNet) had excellent reputations for customer service until they were all taken over by TPG.
Nowadays Aussie Broadband has a pretty good reputation and interestingly has basically followed the same model: not always the absolute cheapest, but competes on benchmarks like speed, and with an engineering-heavy management team.
It took a long time to force this, but aggressive competition by regional ISPs (especially Internode and iiNet) forced Telstra to allow access to their ADSL network, and once that was in these and other companies used similar tactics to force open other markets.
Optus aggressively used MVNOs to build market share in mobile markets, and while Telstra still charges a premium the generally decent quality Optus network has kept a cap on how much additional they can charge.