Telstra rivals fear more exchange closures

Dylan Bushell-Embling
13 Mar 2009

Telstra's surprise decision to close down a Canberra sub-exchange - cutting off around six ISPs using the building to offer services to their customers - could be the start of a trend, competing operators have warned.

"I think there's no doubt that Telstra will do this again if they are able to," David Forman, executive director of the Competitive Carriers' Coalition (CCC), told

"They've made it very clear that this is the type of network change they want to move to"&brkbar; and that they don't see the implications of that change for competitors as something that they should have to worry about."

Telstra last week said it was closing a sub-exchange in the Canberra suburb of Deakin, which six operators offer services through via ULL, and building a PSTN service instead of a new ADSL exchange.

The CCC and one of its members, iiNet, have filed complaints to the Australian Competition and Consumer Commission (ACCC) over the closure.

As well as iiNet, two other CCC members - Internode and AAPT - use the exchange to provide ADSL services.

iiNet's chief regulatory officer, Stephen Dalby, said nine of its customers would be affected. "This is not the first for us, but is the first that will affect "ËœNaked DSL' customers who have the most to lose by Telstra refusing supply," he said.

Internode carrier relations manager John Lindsay said the company had connected its 42 customers within the service area directly to the main exchange, which houses equipment part-owned by Internode. They are not dependent on the sub-exchange, but may be jumpered within it.

"[Telstra] are using [the demolition] as an excuse to disconnect the 42 or so customers from the Deakin exchange," he said. "This removes Internode's capability to service our customers with our own equipment."

Lindsay said eight customers will be directly affected by the closure, and Internode has been forced to tell them that they need to select a new service using Telstra Wholesale DSL ports - which are $30 more expensive due to the cost of leasing the ports - or switch to a lower-speed plan at the same cost.

"We are concerned that Telstra will use this event to establish a precedent so that they can continue to disconnect customers from competitors' equipment," Lindsay said.

Around 10% of all loops in Australia are used by competitors to deliver cheaper, faster services than Telstra's own retail offerings, he said. "Telstra obviously have a significant incentive to find ways of limiting this competition."

Dalby expressed skepticism at Telstra's explanation that the building housing the sub-exchange was being knocked down.

"Their landlord doesn't tell them how to configure their network. Being forced to find new premises is not a reason to reconfigure the network so that competitors cannot provide services," he said.

Lindsay was also skeptical of Telstra's claim that the new building will not have sufficient copper access for an ADSL exchange.

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