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Telstra failed to treat ADSL customers equally

Telstra's wholesale customers were not given access to new ADSL products at the same time as Telstra's own retail ISP BigPond, the ACCC has found.
Written by Josh Taylor, Contributor

Telstra's wholesale arm created two new ADSL products for its retail arm but failed to offer similar products to its retail competitors, the Australian Competition and Consumer Commission has found.

As part of the transition to the National Broadband Network (NBN), Telstra agreed to structurally separate its wholesale fixed line network business from its retail businesses, including BigPond.

The ACCC produces a yearly report to ensure the company's structural separation undertaking is working as planned to keep the two arms of the company separated, with no information sharing, and no special preferences given to Telstra's retail arm.

In its annual compliance report (PDF) tabled in Parliament today, the ACCC found a number of instances in the 2012-2013 financial year where Telstra had breached the undertaking over information security and equivalence obligations.

The biggest breach came through Telstra continuing to struggle to ringfence 14 wholesale and data warehouse systems to prevent Telstra Retail staff from accessing those systems. The ACCC said in its report, Telstra was continuing to work to remediate these issues.

In another instance, Telstra's small business call centre staff were emailed to check whether a customer on a call was a BigPond customer. The company was then tasked to train staff to ensure they do not look up a customer's retail provider in the wholesale system.

Outside of information ringfencing, the ACCC found that new ADSL products offered to BigPond were not also offered to Telstra's retail customers.

"This meant that wholesale customers were not able to migrate an existing ADSL service to a better ADSL service supplied from a Telstra cabinet when retail services could be migrated in that way, and wholesale customers having fewer line configurations available to optimise consumers' services," the ACCC said.

In a statement, a spokesperson for Telstra said that the SSU was "working well" but highlighted "some gaps in our systems."

"We proactively identified these gaps ourselves and we are investing significantly in our systems to close them. The SSU sets a very high bar. It encompasses the potential for actions that are not equivalent as well as actual instances of Telstra not providing equivalence between wholesale and retail," the spokesperson said.

"This report outlines some gaps that create the potential for non-equivalent treatment as well as actual actions by Telstra that have impacted our wholesale customers. The report includes no evidence to suggest our retail staff have used wholesale customer information to gain an unfair commercial advantage."

The spokesperson said that overall, Telstra had more than 100 million interactions with customers on the copper network, and the company had performed "very well in delivering equivalence across all these interactions."

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