The Australian Competition and Consumer Commission (ACCC) issued a draft decision rejecting Telstra's unconditioned local loop service monthly charges, saying that the $30 monthly fee is "not reasonable."
The service, which allows access to the basic elements of Telstra's customer access network, is considered a key input into the development of facilities based competition in Australian telecommunications, providing greater benefits for end users.
'The ACCC considers that Telstra's proposed monthly charges for the ULLS are not reasonable', Graeme Samuel, ACCC chairman, said.
Telstra has proposed for the first time averaging the significantly different cost estimates for providing the ULLS across all geographic regions into a single monthly charge of $30.
'The ACCC believes that Telstra's proposed average price is unlikely to promote competition on its merits and likely to heavily distort the use of and investment in telecommunications infrastructure," Samuel said.
'Telstra's prices also adopt a proposed method of cost recovery for ULLS specific costs which has now been rejected by the Australian Competition Tribunal following Telstra's appeal on its undertaking for the Line Sharing Service'.
Further, the ACCC continues to have concerns with Telstra's proposed network cost estimates, saying that Telstra's cost model "overstate" costs in rural areas.