Competition tribunal backs Telstra’s ULLS denial

Competition tribunal backs Telstra’s ULLS denial

Telstra’s cost model ‘not reasonable’

The Australian Competition Tribunal has backed the ACCC’s decision to reject Telstra’s proposed pricing for their unconditioned local loop service (ULLS); the copper line that connects the telephone exchange to the consumer.

Telstra proposed that a cost of $30 per customer line per month be charged to customers living in “the Metropolitan Band 2 exchange service areas”, which covers around 70 per cent of Australia’s population.

This plan came despite the ACCC’s recommended price of $16 be charged for customers in the same region.

Telstra’s reasoning behind the decision was that the ACCC’s price was not based on efficient costs. This was not supported by the tribunal.

“The ULLS should be priced on the basis of the up-to-date costs of replacing a historical relic while keeping most of its essential design features and merely updating its equipment”, according to the tribunal. The news comes as another blow for Telstra with executive director of media relations, Andrew Butcher, this week announcing his resignation from the company and CEO David Thodey recently reshuffling his executive team.

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Tags TelstraDavid ThodeyAustralian Competition and Consumer Commission (ACCC)

More about Andrew Corporation (Australia)Australian Competition and Consumer CommissionTelstra Corporation

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