ACCC angers Telstra yet again by extending PSTN price regulation

31 Jul 2006

The Australian Competition and Consumer Commission (ACCC) has ruled that fixed line incumbent Telstra must continue to limit the unbundled local loop (ULL) prices it charges competitors for using its PSTN, starting on 1 August, for a further three years. ACCC chairman Graeme Samuel said that maintaining regulation of ULL services would promote competition, but added that pricing issues surrounding ULL remained contentious and the ACCC would therefore not be releasing pricing guidelines immediately. The ACCC said pricing caps will also be extended to line rental charges, prompting Telstra spokesperson Liz Jurman to claim ‘the regulator is stuck in a timewarp,’ according to the Financial Times.

The decision has heightened tensions between the incumbent and regulator, which have been long involved in a bitter exchange over how Telstra will provide rivals with access to its planned AUD3.1 billion (USD2.4 billion) next generation network. Telstra releases its annual results on 10 August, after which the government will decide whether to sell its remaining 51.8% in the company. The question of network access will have a major bearing on Telstra’s future, including affecting its sale value.

Australia, Telstra (incl. Belong)