Aussie competition regulators reject Telstra access rates

13 Sep 2006
00:00

The Australian Competition and Consumer Commission (ACCC) issued a draft decision to reject Telstra's PSTN originating and terminating access services and local carriage service (LCS) undertakings.

The PSTN services are used as inputs by competitors primarily to supply long distance calls as well as fixed-to-mobile and mobile-to-fixed calls.

They can also be used by competitors to interconnect with Telstra's fixed network.

The LCS is used by competitors to supply local calls to end users. It allows competitive entrants to resell local calls without deploying substantial alternative infrastructure.

In a statement, the ACCC Telstra's proposed undertaking prices would involve a substantial reduction in the headline LCS prices and a substantial increase in the headline PSTN prices.

'The ACCC is not satisfied that Telstra's proposed prices, which have been presented to the ACCC as a package, are reasonable', ACCC chairman, Mr Graeme Samuel, said. 'Telstra's proposed pricing approach for the PSTN and the LCS would represent a fundamental rebalancing of the competitive dynamics in the fixed line services markets, with a doubling of the headline rate for PSTN services.'

The ACCC also said it is not satisfied that Telstra's proposed charges are based on reasonable estimates of efficient costs.

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