Telstra faces ongoing local call pricing battle

Telecommunications players and the Australian Competition and Consumer Commission (ACCC) are gearing up for a busy year as plans to regulate Telstra's monopoly on the local telecomms industry move full steam ahead.

Late December, the ACCC announced a draft decision to declare local calls, ending Telstra's strong hold on the local call market and paving the way for cheaper local calls in the future. A final decision is expected sometime in the next month, but changes to current prices may not eventuate for several months.

In a separate issue, the ACCC has instituted proceedings into Telstra's local call transfer process, known as the commercial churn. The ACCC is alleging Telstra's actions are anticompetitive and on December 24 last year introduced penalties of up to $20 million plus $2 million each day until the telco giant changes its process.

Officials told ComputerWorld, the first directions hearing for the investigation will be held in late January or early February.

Competing carriers have also jumped on the ACCC's bandwagon to curb Telstra's anticompetitive behaviour, announcing plans late last year that will come into effect following the ACCC final rulings.

Macquarie Corporate Telecommunications, one of the first companies to fight for deregulation of the local call market, announced last year plans to offer a 20 cent capped local call once a final declaration on local calls is made.

Despite being ready for any changes that may come out of the ACCC proceedings, David Tudehope, Macquarie Corporate's chief executive, said he is not expecting any definitive changes to the local call market for another six months or a year due to appeals from Telstra.

"Assuming declaration goes ahead in February, negotiations between competitors and Telstra on issues such as pricing will take some time, and if it goes to arbitration, consumers may wait years for an outcome," Tudehope said.

For Roger Nicoll, group general manager for network planning and interconnect at Primus Telecom, resorting to the ACCC for arbitration and waiting until the year 2000 for access terms to be finalised would be a worst case scenario.

"Hopefully there will be terms to allow us to operate in some manner around the April time frame," Nicoll said.

"We will work through the contentious issues in the next year."

Primus announced in early January plans of a rollout exchange program based on access to Telstra's copper lines. Under the program, Primus is establishing exchanges at every Telstra exchange throughout the CBD of Sydney, Melbourne, Perth, Brisbane and Adelaide. Nicoll said Primus is ready to begin the new services in Melbourne right away and is expected to launch the Sydney service in about five months time, to coincide with the access announcement.

"In Melbourne we have access to three gateways . . . [we are] looking forward to really attacking the local lines services in the CBD," Nicoll told Computerworld.

Join the newsletter!

Error: Please check your email address.

More about Australian Competition and Consumer CommissionAustralian Competition and Consumer CommissionMacquarie Corporate TelecommunicationsPrimus AustraliaTelstra Corporation

Show Comments