Telstra Willing to Change OzEmail Bid

SYDNEY (01/31/2000) - Australian national carrier Telstra Corp. is willing to make changes to its bid for ISP (Internet service provider) OzEmail Pty. Ltd. in order for the acquisition to get the all-clear from the Australian Competition and Consumer Commission (ACCC).

However, if the acquisition is rejected, it will not be a major setback for the telco, John Rolland, Telstra's director of online services said.

"In our Internet plans there's number of prongs -- access, content, portal, e-commerce, and of course we have aspirations outside of Australia. It wouldn't be a major setback," he said.

"We've made it very clear we would like to discuss ways to get the deal through. We're willing to listen," he said.

The ACCC has "significant concerns" about the A$300 million (US$191 million) acquisition, which would see the number one ISP, Telstra Big Pond, merge with the second largest.

In a preliminary statement, the consumer watchdog said it has concerns that the acquisition will "lessen competition."

In the short time the commission has had to consider the acquisition, it cannot yet agree to the merger, ACCC chairman Allan Fels said.

"It is possible that the proposed acquisition could have a detrimental impact on the competitive dynamics for Australian online content, online advertising and electronic commerce," Fels said.

"The Internet markets are still in the early stages of development in this country, The emergence of a dominant Australian ISP could retard competition and stifle innovation in these evolving markets."

It is expected further meetings will be held with Telstra and other interested parties as more information comes to light.

Telstra can be found online at http://www.telstra.com.au/.

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More about Australian Competition and Consumer CommissionAustralian Competition and Consumer CommissionBig PondOzEmailTelstra Corporation

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