Optus: Telstra/ACCC deal 'disappointing'

Summary:Optus today said that the terms of Telstra's AU$6.5 million deal with the competition watchdog over broadband pricing were "disappointing", given the telecommunications heavyweight had accrued a potential cumulative liability of AU$300 million.

Optus today said that the terms of Telstra's AU$6.5 million deal with the competition watchdog over broadband pricing were "disappointing", given the telecommunications heavyweight had accrued a potential cumulative liability of AU$300 million.

Paul Fletcher, director Optus corporate and regulatory affairs, said that the terms of the settlement brokered by the Australian Competition and Consumer Commission with Telstra were disappointing.

"In February 2004, Telstra used its privileged knowledge of the start date of Optus' resale DSL service to ambush Optus' competitive entry - by announcing a sharp drop in its own retail prices the day before Optus launched services," he said.

"Yet under the formula agreed between Telstra and the ACCC, Optus will receive a rebate which is just over 1 percent of Optus' likely spend with Telstra on DSL in our current financial year.

"Given that Telstra's cumulative liability for fines under the Competition Notice exceeded AU$300 million, it seems to have got off remarkably lightly with a settlement of AU$6.5 million.

"So while the ACCC has done good work in the initial stages of this dispute -- being instrumental for example in securing reductions in Telstra's wholesale price in March 2004 -- the ultimate resolution of this issue is disappointing.

"It does not seem to be an outcome which will deter Telstra from throwing its weight around in the future," Fletcher said.

Topics: Telcos, Government, Government : AU, Optus, Telstra

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