Outraged Telstra says court loss threatens future broadband investment

Alex Zaharov-Reutt
Thursday, 06 March 2008 10:38

IT Policy - Regulation

The High Court of Australia has ruled against Telstra’s assertions that allowing competitors inexpensive access to Telstra’s network sees those competitors unfairly acquiring Telstra’s assets without just compensation – and Telstra is not happy!

Telstra has published an outraged response to the High Court of Australia’s decision that the “telecommunications access regime set out in the Trade Practices Act (TPA) did not amount to an acquisition of Telstra’s property” in the Media Centre section of the Telstra.com.au website.
 
Telstra claims that the High Court decision allows competitors to ‘buy’ access to Telstra’s network and not ‘build’ their own new infrastructure.

Telstra spokesperson Jeremy Mitchell told iTWire that “What the High Court has said today to our competitors is ‘Don’t worry about investing, sponge off Telstra’.”

Mitchell said that the decision was “not in the best interests of consumers and the industry”, with the result a “disappointment not just for Telstra but the telecoms industry as a whole.”

Explaining why, Mitchell said: “Why I think it is a disappointing result for the industry, is that the industry is always healthy when there is good, fierce competition and you won’t get that when people just resell Telstra!”

Mitchell ended his comments to iTWire saying that: “We’re not against regulation; we just want fair and equitable regulation. What the ACCC is doing is not fair and equitable – and our shareholders are losing out.”

Of course Telstra doesn’t mention the fact that nearly 100 years of taxpayer dollars gave Telstra the money it needed to build the national network it owns today, but given the fact the previous Federal Coalition Government effectively privatised Telstra and there is no structural separation of Telstra’s infrastructure/wholesale and retail divisions, there is some merit to their argument that their assets are being unfairly stripped away.

The High Court of Australia noted in a media statement that: “The rights in Telstra’s assets were rights to use the assets in connection with the provision of telecommunications services but those rights were always subject to a statutory access regime which permitted other carriers to use its assets. Telstra had always owned and operated the assets within a regulatory regime by which other carriers have the right to connect their facilities to Telstra’s network and to obtain access to Telstra services.”

Please read onto page 2.