David Forman, executive director of Competitive Carriers Coalition (CCC), claimed that inflation is preventing Australian carriers from competing effectively in the telecommunications market.
“Inflation is the number one economic challenge for the Rudd Government as it comes into office this week,” said Forman. “We pay more than just about every country in the OECD for basic telecommunications services.”
He also stated that government regulation of the sector is essential to the future of the industry; otherwise Australian customers will continue to pay prices significantly less competitive than the rest of the world.
“Other developed countries are moving quickly to implement a new wave of competition reform, which means Australia risks falling even further behind in the next few years unless we act now,” said Forman.
Forman asserted that Telstra’s monopoly in terms of infrastructure holds carriers to ransom as they are being forced to pay inflated wholesale prices. The telco is also accused of exacerbating the situation with lawsuits and challenges to ACCC decisions.
“Telstra has used every means possible to delay and frustrate access to the network by competitors,” said Forman. “The result is that competitors need to engage in long and expensive negotiations just to access basic infrastructure.”
Recent OECD figures revealed that fixed line costs in Australia for small business and SOHOs are inflated between 30 to 40 percent above the OECD average. The solution, according to CCC, is structural reform to give back a competitive edge to Australian telecommunications providers.
“The current regulatory framework has shored up Telstra’s monopoly and profits at the expense of true competition and innovation,” said Forman. “The challenge for the government is to restructure the sector quickly, and reap immediate benefits.”
CCC calls for reform of Aussie telecommunications
By Staff Writers on Nov 29, 2007 6:53AM