Telco rivals slam govt intervention in Telstra price decision

Five of Telstra's rivals have come out strongly against the Department of Communications' support for a hike in the regulated wholesale prices Telstra can charge access seekers for its copper network.

The Competitive Carriers Coalition, comprising telcos Vodafone, Macquarie Telecom, iiNet, Nextgen Networks and MyNetFone today took umbrage at a submission to the ACCC's enquiry on the issue written by Communications secretary Drew Clarke.

Clarke encouraged the competition watchdog to revisit its draft determination from last month, which would see wholesale prices slashed by 9.6 percent.

Telstra had pushed for a 7.2 percent rise in regulated wholesale prices to compensate for customers leaving its network and moving onto the NBN.

Clarke argued the ACCC's decision would have a negative impact on the telco sector and discourage migration to the NBN.

But the CCC took issue with the department's involvement in the debate and accused it of not respecting the independence of the ACCC.

"The Department of Communications' intervention in the ACCC's independent price determination process to advance the interests of Telstra is extraordinary, unwelcome, unwarranted and sets a dangerous precedent," the CCC wrote.

"Will this be followed by the Department of Finance telling the RBA it is wrong on interest rates? Or the Treasury telling APRA not to regulate the banks so harshly?" 

That the DOC should call for higher prices for ordinary consumers when Australia "has the national disgrace of the highest prices in the developed world, beggars belief", the telco coalition said.

The need for incumbent Telstra to be compensated for the NBN had been examined and rejected by a previous two-year independent ACCC inquiry, the rivals stated.

The CCC said Communications Minister Malcolm Turnbull must realise the submission "was a mistake" and demanded he instruct the department to withdraw it.

The ACCC is scheduled to publish its final decision in September.