ACCC rejects Telstra's unbundling plan

The Australian Competition and Consumer Commission (ACCC) has rejected Telstra's undertaking to charge a flat A$30 ($21.24) per month for unbundled wholesale access.

It is the third proposal from Telstra that the ACCC has rejected as unreasonable since 2004.

“Following an extensive assessment of Telstra's undertaking, including Telstra's own cost model, the ACCC is not satisfied the A$30 charge for metropolitan areas is reasonable,” ACCC Chairman Graeme Samuel said.

The proposed price is unlikely to promote competition in the broadband and telephony markets, and may discourage investment in telecom infrastructure, Samuel said.

“The ACCC also considers that a A$30 monthly charge would result in Telstra recovering more than is necessary to promote its legitimate business interest in providing this service,” he added.

The proposal only covers “Band 2” exchange service areas, which service around 70% of the population but span just 0.2% of the land.

Considering that Telstra's earlier proposal represented an average $30 price for all areas in Australia, Telstra in effect proposed a higher fee than had already been rejected, the ACCC said.

Telstra is required by law to provide competitors with unbundled access to its network.