Rivals Criticise ACCC for Freezing Telstra Price

Submitted by Jim Thesiger on 4 December, 2009 - 15:46

The rivals of Telstra (TLS), which is the largest telecommunication carrier of Australia has became furious after the Australian Competition and Consumer Commission (ACCC) decided to freeze the prices of accessing millions of telephone lines through the company. ACCC announced that it would roll the prices over to December 31 of the next year despite revealing a new pricing model in August. The competition regulator also mentioned that it would review the process through which the prices are fixed. The model increased the fee by $7.6 that Telstra could charge its competitors for accessing the local loop or ULL services. That raise is not going to take in place after ACCC made its announcement to freeze the rate.

However, the other telecom companies expressed their anger about the ACCC decision by stating that the regulator previously indicated that the price should decrease. The decision made by ACCC means the rivals of Telstra will not be able to plan more than one year in advance something that has significance as the Federal Government is constructing the national broadband network (NBN). David Forman, of Competitive Carriers Coalition stated that ACCC has repeatedly stated in the last two years that the price charged by Telstra for basic wholesale services was very high and by deciding to freeze the price, the regulator have failed to protect the interest of the consumers and the competitors for which it should be ashamed.

However, Telstra expressed its satisfaction about the ACCC decision. Jane van Beelen, the head of regulatory affairs of the telecommunication company termed the decision as a sensible one and claimed that it has enabled the next step of achieving regulatory certainty in the long run. Maha Krishnapillai, the Optus government affairs boss also welcomed the ACCC decision. According to him, the latest pricing review gave the opportunity to deal with the unfair push made by Telstra to increase the access price.