Telstra loses last mile regulator race

Access price hike would stymie competition

Telstra has lost its final appeal to impose a $30 charge for competitors to access the last mile copper network in metropolitan areas.

The appeal was knocked down by the Australian Competition and Consumer Commission (ACCC) ending a bitter dispute that has lasted for more than a year and seen Telstra submit four undertakings to the regulator to increase access prices.

Telstra has requested the charge be imposed on rental costs for the Unconditioned Local Loop Service (ULLS) which governs about 70 percent of the 10 million lines in the country. ISPs need the last mile ULLS to provide ADSL services to customers.

ACCC chairman Graeme Samuel said he was surprised with the appeal since the ACCC had refused a Telstra bid to increase access prices by a smaller amount in 2006.

“Following an extensive assessment of Telstra's undertaking, including Telstra's own cost model, the ACCC is not satisfied the $30 charge for metropolitan areas is reasonable," Grahame said in a statement.

"The ACCC believes that Telstra's proposed price is unlikely to promote competition in the broadband and telephony markets. It may also discourage investment in telecommunications infrastructure.

"The ACCC also considers that a $30 monthly charge would result in Telstra recovering more than is necessary to promote its legitimate business interest in providing this service,” he said/

The regulator claimed the Telstra's proposed price hike was “significantly” above those offered in comparable countries.

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