Telcos line up with ACCC against Telstra

Macquarie Telecom, MyNetFone and Telcoinabox join Optus and TPG in opposing Telstra

Three more telcos have been added as respondents to Telstra’s legal action against the Australian Competition and Consumer Commission. Telstra is seeking a review of the ACCC's decision to cut the wholesale prices the telco charges.

Macquarie Telecom, MyNetFone’s wholesale subsidiary Symbio and Telcoinabox are joining the ACCC in opposing Telstra's application. All three are members of the Competitive Carriers Coalition (CCC).

TPG and Optus last year also joined as respondents

That brings to five the number of telcos opposing Telstra, which is seeking a review of an ACCC decision to cut the regulated wholesale prices the incumbent carrier can charge for seven fixed line services.

Telstra has argued it should be allowed to raise prices.

However, in a decision issued late last year the ACCC decided on a one-off uniform fall of 9.4 per cent in access prices for the services, revised down from the 9.6 per cent fall in a draft decision issued in June.

The decision on prices applies from 1 November 2015 until 30 June 2019.

A case management hearing was held today in the Federal Court in Sydney.

Telstra’s application for judicial review centres on how the ACCC treated the “costs” to Telstra related to the loss of economies of scale as more end users migrate from the telco’s copper network to the National Broadband Network.

The cuts in wholesale pricing are “fundamental” to developing a competitive market for broadband and other fixed telco services markets, especially in the lead up to NBN, said Macquarie Telecom’s national executive, industry and policy, Matt Healy.

“The ACCC’s two-and-a-half year inquiry process that arrived at setting these prices late last year we think was exhaustive. All sides had their interests put and had a significant opportunity to put their case," Healy said.

“We see that, notwithstanding the final determination of the commission, the ACCC, Telstra’s challenge of that is basically another example of how they throw their market power around.”

“The impact of that is to attempt to hold back competition, keep consumer prices high and innovation constrained,” Healy said.

“The CCC members that are most impacted have joined the proceedings — Macquarie, MyNetFone and Telcoinabox — but it’s strongly supported by all CCC members.

“If Telstra has the ACCC’s decision overturned we think competitive carriers and the Australian consumer will be significantly hit. We strongly believe that the ACCC decision is legally sound and followed due process and we won’t stand buy as Telstra tries to bully the umpire.”

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