ACCC tells Telstra to GAGF, Telstra disappointed, wastes more money

The ACCC recently announced that they would not accept a proposal from Telstra for a wholesale access price of $82 to a monopoly Fibre-to-the-Node (FTTN) network.

The G9 proposal, also being considered (and expected to be in the public domain within days) is for $15 basic telephony access, and $45 for ADSL2+ access, all up $60, for wholesale access to the network (the only way the network works).

If you ask me, $60 is a lot cheaper compared to $80 when you look at the resulting outcomes.

$82, Telstra + Mandatory AGVC + GST + Customer Data + Support + Services = Roughly $115.
$60, G9 + GST (?) + Customer Data + Support + Services = Roughly what an iiNet customer pays for ADSL2+ with phone. Pretty competitive.

Under the G9 proposal, we can’t forget that they propose to have Access to allow providers to make unique offerings, so, possibly cheaper ports at slower speeds, but of course, some level of transparency between each band.

Telstra now propose to start a campaign attacking the Federal Government on lack of spending on infrastructure, putting more unneeded pressure in an already pressurised environment.

I wouldn’t want to be Helen Coonan now.
I imagine it’s something like this for her:
– Telstra: We want to give Australian’s faster Internet Access, we want these regulations removed, we don’t want any competition, and we basically don’t want the ACCC to do what it was originally set up to do.
– G9: We don’t believe it right Telstra gets another chance to extend its monopoly and tear apart customers for all their income and more, we have a proposal that will see Australia get a competitive, fast, upgradeable, extendable network, and we won’t bend them over either. We won’t wage war against the government our customers voted in, we won’t be overly concerned with making big bucks for shareholders as our investment model is long term, as such a model should be. We don’t want Telstra building if we do decide to buid a network.
– John Howard: Get these Australian’s fast broadband. I don’t want to see my possibly retiring term here ending with the voting out of the government.
– Senator Conroy: Nerrr, We Are better, we got the voters, and you might not.
– Media: What are your thoughts on Telstra this, G9 that? What are you planing to do? Are you falling to pressure of Telstra?.. Cameras start snapping shots, she becomes enraged with violence (well, wishful thinking – I shall call that: SuperCoonan, Faster than a speeding byte on a fraudband port).

And all the while, we get to see is media flashes about how Telstra want this for shareholders, the G9 want this for Australians, and well, the situation as a whole could get dangerous.

Some even believe that the Government might come to a deal with Telstra to avoid the pressure another Telstra marketing campaign might create. I don’t. I think they are better off counteracting it, with evidence that they have and will be looking after Regional Australia, and what better way than… a mailbox leaflet drop.. wait, that’s what they are doing. $5 million dollars of tax payer funds going to disarm the Telstra rubbish they plan to send out. Sounds worth it, if they do a good job of it and educate all, including those greedy pig Telstra shareholders.

Here is a recent article in a media website I was reading, that I found rather.. Full of Crap for want of better words:,20867,21657209-601,00.html

Oh, it’s written by Michael Sainsbury, that says a lot.

He goes on in that article to say that Telstra is planning on launching an aggressive marketing campaign (Read: Blow more dollars needlessly), due to the collapse of an agreement between Coonan And Trujillo.

– Michael, there never was an agreement in place, they had talks, but no agreement formed, the ACCC is the body that would do that.

He goes on further to say that after 1 month of negotiations, they came to terms for the rollout. The terms were blocked by the ACCC.

– Seems incorrect, considering Telstra would be placing the terms on the table, and all she could do is basically provide initial feedback, and that feedback seems like it’s not enough for Graeme Samuel – rightly so too.

He writes further that Coonan has stated that Telstra need to make their case clear, because they need to understand what they really mean by fair commercial return.

– That’s right on the mark. Fair commercial return seems to be 30%+ of revenue being Telstra shareholders profits. Should the Australian public be expected to fill that hole? Nope. They chose that $82 dollar figure, which basically says what they make at the moment.
– Just on that note too, it’s common Telstra shit spinning that they don’t want to sell to competitiors below cost. They were never forced to, and never have been forced to sell “below cost”. They were only ever forced to make retail prices higher than wholesale. Basically, ensure Retail prices are never below what a wholesaler can also package together. That makes them true trash talkers, because they aren’t looking after anything telling lies like that. Such a company can’t make large profits selling below cost.

He goes on further “Senator Coonan has been caught between a political desire to do a deal and solid resistance of the ACCC”
He quotes further down, Coonan stating “I am not sidelining the ACCC” – “The ACCC has a role”.

So, that’s a little bit confused don’t you think?
The government should never have an urgent need to do a deal with anyone, let alone Telstra (of all companies, the worst).
The ACCC have a job to do, they do it well. If the interested parties have a business case they want to put forward, and the balance is sound (near or lower than current prices, or significant improvements that have a higher cost to maintain then the existing), I don’t see how it would be a problem. But that’s not the case. Speeds would only be enhanced to a next step technology, and the other company can do that already, for $45, instead of $82.

The only thing Telstra are overly concerned about is preventing that $82 dropping lower. For them, the fortunate case is, they aren’t going to be able to. They are going to make a lower revenue packet off wholesale, and its about time. It’s time the G9 had a shot and got things DONE, and done for consumers, not shareholders.

I’m in a Regional 1 area, and I don’t see a need to get faster broadband off the ground “quick and dirty” by Telstra, but more “correct, competitive, and complete” by the G9.

I still do have a desire for fast broadband, but not if I have to pay an arm and a leg to get it, or the competitive environment is going to sink to a new low as a result of it.

On a related note, others have accused ACCC Chairman Graeme Samuel of having a bias against Telstra. As much as they might like to believe that is correct, I would argue he has a family to feed, a house to keep them in, and his integrity in being anti-Telstra or Pro-Telstra would reflect negatively on his position and his integrity. He wouldn’t risk that for a dislike of Telstra. I know I’d have told them to GAGF though, they are being completely stupid in their approach to this, either way, they are going to lose money on this, they might as well as just work a way to build the revenue in other areas, and let the G9 do the job, or get in on the action and build it in line with the G9’s proposal, or better it, they would minimize the total loss that way.

Interesting days ahead on this issue.. I can’t wait to tear that G9 proposal apart and get all the dirty details.

This entry was posted in Random. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *