Telstra does a backflip on ADSL2+ wholesale access

Telco giants says it will offer wholesale access to its recently launched ADSL2+ broadband network

Telstra has done a back flip on its ADSL2+ broadband wholesale strategy and announced it will allow ISPs access to the network.

The telco giant raised the ire of competing ISPs when it revealed plans to rollout a national ADSL2+ network but failed to provide details on whether it would grant wholesale access to the new service.

The ADSL2+ rollout, which was announced in February and completed by April, saw services switched on across more than 900 exchanges covering 4.2 million users.

Telstra spokesperson, Martin Barr, confirmed its plans to offer wholesale access to its national ADSL2+ services this week.

"Telstra Wholesale has always said that we would consider selling ADSL2+ if and when it made commercial sense to do so," Barr said in a statement. "Since we received assurances from the ACCC that they won't interfere we were more confident about taking a look at our commercial options."

At the time Telstra CEO, Sol Trujillo, said its decision to flick the switch was prompted by the new Federal Government's reassurance that third-party access would not be regulated. But this lack of regulatory certainty released a barrage of complaints from rival ISPs, who accused the telco giant of anti-competitive behaviour by barring wholesale access to the network and called for the watchdog to take immediate action.

Netspace regulatory affairs manager, Ben Dunscombe, welcomed the latest news but said the impact of Telstra's decision depended on its ADSL2+ wholsale pricing.

"Telstra won't be the first carrier to offer this product [Optus and iiNet/AAPT also offer ADSL2+ services wholesale], so if they're serious they need to offer market competitive pricing," he said. "If they come to the table with competitive pricing it would be a very welcome step and an open gesture on their part as a decent corporate citizen."

News on ADSL2+ services also raises questions about whether Telstra will offer wholesale access to its next-generation broadband network should it win the government's multi-billion dollar National Broadband Network tender. The tender was released in April. Others known to have submitted a bid include the Terria consortium led by Optus.

"Telstra can't come in with their normal inflationary pricing [for ADSL2+] otherwise it's just a show and doesn't bode well for their open access model for the fibre-to-the-node network if they win," Dunscombe said.

Ovum research director, David Kennedy, was unsurprised by Telstra's decision and was certain the telco would offer wholesale access to its next-generation broadband network.

"Telstra's approach to wholesale is that they've always been happy to offer product, but they don't like regulated pricing," he said. "Pricing will emerge with access seekers - I don't think there will be one standard price for everybody."

According to a recent report by the Centre for International Economics, Australian consumers could pay an additional 15 per cent for broadband if Telstra secured the contract.

While many in the industry believe a structural separation of Telstra's retail and wholesale arms is the only way to prevent further anti-competitive behaviour, Barr stressed Telstra was against it and insisted its plans to offer ADS2+ were not linked to ongoing discussions about the structural separation.

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