Optus has attacked plans by Australian market leader Telstra to make its Foxtel pay TV content exclusively available to its broadband customers.
In a submission to the Australian Consumer and Competition Commission (ACCC), Optus described the proposed arrangement as a “blatant attempt by Telstra to use its ownership interest in Foxtel to tie up access to Foxtel’s content.”
Telstra, Australia’s biggest telco, is a 50% owner of Foxtel, the major pay TV provider.
“Optus forecasts that it will lose existing and future customers, since consumers who wish to purchase Foxtel's proposed service will have no choice but to purchase broadband services from Telstra,” SingTel-owned Optus said in its submission.
“This proposal should be seen as a thin end of the wedge for Telstra's ability to use its control of content to establish a broadband monopoly.”
Telstra hit back at its critics telling the ACCC that negotiation of the commercial arrangements for the proposed service were conducted at “arm's length between Foxtel and Telstra.”
“While Telstra has a close working relationship with Foxtel and an ownership interest in Foxtel, Telstra has no influence or control over day-to-day commercial decision making by Foxtel,” it said in its submission.
Tony Brown, a senior Informa analyst, said it was very unlikely that the ACCC would allow the Telstra-Foxtel deal to proceed.
“The ACCC will very likely rule that the deal is anti-competitive,” he told telecomasia.net.
“In fact, given that we are moving towards the arrival of the open access NBN, it would not make any sense at all for the ACCC to allow such a deal to proceed.
“If broadband operators want to gain access to exclusive video content then they will have to buy it themselves rather than trying to bring it in via a deal like this one.”