Competitors hit back at Telstra's 'misinformation' campaign

Stuart Corner
Wednesday, 11 April 2007 09:44

IT Policy - Regulation

Eleven of Telstra's competitors have joined forces to counter what they claim is a concerted campaign of misleading and deceptive information being put out by Telstra.

They have formally complained to the ACCC in relation to  a number of specific statements made by Telstra. They have launched a website and intend to brief a number of MPs.

 The group comprises AAPT, Austar, iiNet, Internode, Macquarie Telecom, Powertel, Primus Telecom, Telarus, TransACT, WestNet and Unwired. It claims that "Telstra is pushing the false impression that Australia's regulatory regime somehow ignores its costs and legitimate business interests."

 "Telstra is on a rampage to force both sides of politics to weaken the Trade Practices Act so it can increase prices," a group spokesman said. A law firm acting for the group, Nicholls Legal has written to the ACCC demanding that it launch a formal investigation into the allegedly misleading and deceptive conduct.

 The move follows an earlier letter to Telstra's group general counsel, Will Irving, demanding an undertaking from Telstra that it cease making statements similar to the ones in question and that it publish in The Australian newspaper and on its 'nowwearetalking' website a correction in a form suitable to the group. The group says that Telstra has not met any of its demands.

 The letter to the ACCC details a number of public statements by Telstra senior executives. In one statement, Phil Burgess, group managing director, public policy & communications, in a 24 January Telstra media release, said: "The most recent decision of the ACCC, announced in the days before Christmas, allows Telstra's competitors to buy broadband infrastructure for just $3.20 per month, and then re-sell it for around ten times that amount, forcing our shareholders to pay money from their back pockets to fund largely foreign-owned competitors."

 Another concern is a statement made in a teleconference by Burgess on the same day in which he said. "So we have a real conflict here. It is not between Telstra and the government; it is between the government and the regulator. The government has a policy of a national uniform price where everybody everywhere, in the bush and in the cities, should pay the same price. The regulator has a policy that the people in the central cities should pay substantially less, almost one-third less, than people in the outer suburbs and the people in the bush are left to pay over $150; whereas the people in the central cities can pay $7."

The group claim that this indicates, incorrectly that the Government has a policy of national uniform pricing for broadband services and that the ACCC has a policy of different prices for the standard telephone service in different geographic areas.

 The Group also has BigPond chief Justin Milne in its sights for claiming, in an email to customers, that Telstra would have to provide access to foreign-owned competitors at below cost and that the government could direct Telstra where to build infrastructure ("imagine the Government telling BHP where to dit its next mine," Milne said in the email).

 The group has launched an education programme under the banner Tell the Truth Telstra (T4) based around a web site (www.tellthetruthtelstra.com.au) that "documents a list of Telstra's myths  and highlights their misleading nature."

 The group has also produced an information kit for MPs and is planning a series of information sessions for MPs, "exposing the truth behind Telstra's attempt to gain relief from regulation."