Aussie watchdog to rule on broadband pricing row soon

Year-long ruck near end

By Tim Richardson • Get more from this author

Posted in Telecoms, 17th February 2005 17:24 GMT

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Australia's competition watchdog could be about to rule on whether incumbent telco Telstra should face legal action over alleged anti-competitive broadband pricing.

In February last year Telstra cut the cost of its retail broadband service undercutting what it charged other operators for wholesale broadband. Rivals said this was unfair and an abuse of Telstra's dominant position.

In March, the Australian Competition and Consumer Commission (ACCC) agreed that Telstra had engaged in anti-competitive conduct and slapped the company with a competition notice.

If found to be in breach of competition law, Telstra could be fined AUS$10m and a further $1m (£400,000) for each day it continues with its anti-competitive behaviour.

Now, after almost a year since it became embroiled in the argument over broadband fees, ACCC regulator Graeme Samuel told a group of politicians that a decision is close and would be made in a "very short while".

However, the Sydney Morning Herald cites unnamed inside sources who claim that the case will be resolved out of court.

Of course, any settlement would be closely vetted by the industry. Last summer, for example, Greg Wilson, the boss of Aussie telco Primus, said that Telstra should be fined more than AUS$100m (£38m) to deter the telco from engaging in such behaviour again.

He told an American Chamber of Commerce lunch in Sydney: "Boy, I'm hoping that a massive great stick will come down on Telstra. They need to be given a massive disincentive not to do this to the industry again." ®