Competitors call on Conroy to rein in Telstra with new legislation UPDATED

by Stuart Corner

Tuesday, 12 August 2008

Page 1 of 3 ! Angry and frustrated by what they see as Telstra's repeated tactics of 'gaming' the regulatory process a group of Telstra's competitors is calling on the minister to introduce legislation that would prevent such behaviour. They claim that Telstra consistently exploits the legislation to  tie up the ACCC's and their own resources in futile responses to Telstra access undertakings - documents that set out proposed prices and terms and conditions for key wholesale services. The Competitive Carriers Coalition (CCC) has written to communications minister Stephen Conroy branding Telstra's behaviour "a cynical exercise in regulatory gaming...that is so blatant that it demands that the Government finally step in." It is requesting "an urgent meeting [with the minister] to discuss the need for immediate legislative action by the Government to end ongoing manipulation of the regulatory regime by Telstra." At the core of the issue is the process by which competitors gain access to Telstra services where no competitive alternative is available, so called 'declared' services such as access to the copper pairs connecting each customer to the exchange (the unconditioned local loop, ULLS). Initially competitors are required to negotiate with Telstra (a strange concept in itself given there is no alternative). If they cannot reach agreement they can lodge an access dispute with the ACCC which must then arbitrate and determine the price. However this determination applies only to that deal: another competitor wanting the same service must go through the same process. The alternative is for Telstra to lodge an access undertaking with the ACCC - a document saying essential: 'we will offer service X under terms and conditions Y at price Z." If the ACCC accepts this, it becomes a public benchmark for the service available to all competitors. However the ACCC has only two choices: accept or reject, and if it  rejects the undertaking Telstra can lodge a revised version and the ACCC must repeat the process. (Also, Telstra can withdraw an undertaking mid way through the ACCC's evaluation and replace it with a fresh one, and Telstra has done so on several occasions). The process of determining a fair price of a service such as the unconditioned local loop is extremely challenging and in the case of the ULLS Telstra has supported its price claim with a sophisticated cost model, the so called TEA model, which contains massive amounts of data on costs, network topology etc. CONTINUED << First page <   1 2 3 Next page > Last page - Post your comment >>

 

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