Primus gets $8 million new year present

Primus Telecom has been given an $8 million new year welcome from Telstra, courtesy of the ACCC for Telstra’s persistent over charging of competitors for access to LSS and ULL based services.

In 12 months from July 2007, Telstra would have lost a combined total of $39,000,000 in revenue, as a result of their overcharging.

The LSS / ULL prices being dropped is doing Telstra no favours at all, but, the regulations imposed are doing an average job at creating competition in the industry.

Telstra in July 2007 lost $16,000,000 back to iiNet in a declaration. iiNet also saved $1,000,000 a month as a result of the more realistic rate for access.

Just off the one company alone, Telstra is down $28,000,000. That’s a lot of money to be blowing down the drain as a result of a failure to act on Telstra’s part (Telstra could have rolled out FTTN years ago).

There are a few other companies also in the queue for declarations, dispute resolution and refunds, being Optus, ZYZed, PowerTel, Request, AAPT, Macquarie, Nextep, Adam, TPG, Internode, and SPT, all for ULL decisions.

So, it would seem Telstra’s bank balance might only be partly puffed for the moment, and get a big drop after all these are sorted out and a lot of refunds are given.

And, the end result will still be the same. Telstra, kicking and screaming, whinging and whining over how they are being hard done by, when a competitor pays them $17 for a line they retail for $19 anyway.

When it comes to FTTN, Telstra should have acted years ago.  Now it’s too late, they have to argue it with the ALP, G9, themselves, and anyone else who wants to join the party.

That said, both Telstra and G9 aren’t interested in FTTN for the speeds it will provide, or the cost reductions that come with a fibre network deployment.

Both sides are planning FTTN as damage control. Telstra doesn’t want to lose a lot of bucks to ADSL2+ ISPs, and G9 don’t want those ADSL2+ DSLAMs stranded and end up paying Telstra high rates for access to artificially limited services.

So, they are both using FTTN as a form of damage control, and it’s not the right environment to deploy such a network. Deploy it when you realise you want to offer consumers faster access, better services, and enjoy a lower cost network.

That’s not the case right now, it’s all about trying to regain control, or trying to get control of the infrastructure.

Do you spend $50,000 on a car that someone else was planning on buying, simply because you don’t want them buying the $50,000 car and would rather they bought the $60,000 car?

Yeh, bad analogy, but you should get the idea, it’s all about damage control, controlling how much they’ll lose, or how many customers they stand to lose in the face of a new monopoly.

We don’t need a new monopoly, we need to get the first companies regulated tightly first.


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