The Competitive Carriers' Coalition (CCC) has praised the ACCC for its decision while labelling Telstra’s attack on the ACCC as “powerful evidence that a strong, independent regulator was the only thing protecting Australian communications consumers from its monopolistic attitude.”
In a scathing comment on Telstra, the CCC says the ACCC decision followed an almost two-year inquiry where Telstra had more opportunity to make it case than the whole rest of the industry combined – “yet the consequences of its arguments would have been absurd and required the ACCC to ignore the billions of dollars tax payers are handing over to Telstra to convince it to support the rollout of the NBN.”
In submissions to the ACCC, Telstra had sought a 7.2% increase in the access charges to cover rising costs resulting from users churning from its network and onto the NBN.
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Telstra said the Move by the ACCC was "disappointing", saying the decision “does not follow the ACCC’s own fixed pricing principles that require Telstra to be given the opportunity to recover from wholesale customers the costs of providing services to them.
"Any regulated entity should be concerned by this decision, especially in circumstances where merits review has been removed,” Telstra said.
But, in his ruling, ACCC chairman Rod Sims rejected Telstra’s arguments, saying that end users of Telstra's network should not incur higher costs as customers migrate to the NBN.
The CCC said in a statement today that the ACCC’s decision for a one-off reduction of Telstra’s wholesale prices for access services would still leave Australian prices well above OECD averages.
“Telstra has the highest market share, the highest profit, the broadest reach of any comparable telco in the world, and its share of industry profit is still on the rise,” a CCC spokesman said.
“Unsurprisingly, Australian consumers pay the highest or near highest prices in the world for basic services and broadband.
“It is a ‘night follows day’ outcome – Telstra gain is consumers’ loss.
“Yet Telstra threatens not to invest when facing a modest cut in the prices it can charge competitors for using its monopoly network to reach consumers.”
According to the carriers' coalition, Telstra’s threat “brought back memories of Telstra’s attempt to hold consumers and the Government to ransom by refusing to invest in broadband in the mid 2000s.”
“Back then, Telstra said it would only upgrade the national infrastructure if it was able to maintain its monopoly and required to offer competitors a right to sell only a 1.5mbps access service.
“Imagine if the then Government had bought Telstra whinging about unfair regulation? Where would Australian consumer be today?”
“Once again, Telstra whinging about a reduction in regulated rates that amount to little more than a rounding error to its mega profits should be treated with contempt.”
Telstra has indicated it might appeal the ACCC’s ruling for the 9.4% drop in access charges but, as yet, has not said whether it will take that action.
