Telstra services inferior, says ACCC

The Australian Competition and Consumer Commission (ACCC) has blamed a lack of resources and less reliable computer systems for "inferior" service levels Telstra supplies to its wholesale customers.

In an "accounting separation report" issued to Telstra, the regulator compared Telstra's customer service performance in meeting non-price terms and conditions for its wholesale and retail customers.

The ACCC raised concerns regarding fault handling and some service connections to Telstra wholesale residential customers. The regulator asked Telstra to indicate what initiatives it would employ to ensure equivalent service levels for wholesale and retail customers.

It also analysed whether there were sufficient margins between Telstra's retail prices and those it charged other service providers to use core services.

The results – for fixed line services - suggested there were sufficient margins for domestic, international calls and fixed-to-mobile calls, but not for local call services -- line rental and local calls combined.

"The insufficient margins for local call services will be an important concern in the ACCC's current local services review," said ACCC chairman Graeme Samuel.

The report also contained imputation testing for the unconditioned local loop core service (ULLS), which allows a competitor to lease the use of the customer's line from Telstra to supply access, voice, ADSL or other services.

"While margins are improving, the report continues to indicate that the average margins available in the provision of ADSL, or of a bundle of ADSL and voice services to residential customers, over ULLS, remain insufficient to recover costs.

"The ACCC notes that it continues to be the cost of transforming the ULLS into the retail service, rather than the cost of the ULLS itself, that appears to be the main cause orf the insufficient margins," Samuel said.