ACCC lifts exemptions on wholesale voice services

The Australian Competition and Consumer Commission (ACCC) today released a decision to lift exemptions applying to certain wholesale voice services provided over Telstra’s fixed line network. The exemptions, applicable in metropolitan areas, had been granted by the ACCC several years ago and served to remove Telstra’s obligation to provide access at prices determined by the ACCC.

The removal of the exemptions by the ACCC reflected a number of market developments since the exemptions were granted, including:

  • the roll out of the fibre National Broadband Network, which served to reduce the prospect that access seekers would continue to invest in equipment that used the copper-based unbundled local loop service;
  • no new entry to supply  wholesale voice-only resale services, and the poor prospects of a wholesale market developing in voice-only resale services in the exempt areas; and
  • Telstra continuing to dominate retail voice markets, as well as exercising wholesale market power by charging prices that are significantly above supply costs in the currently exempt areas.

Frontier (Australia) was engaged by a number of access seekers to provide supporting analysis during the ACCC’s Exemption Inquiry.

The ACCC’s final report is available here.

For more information, please contact Marita O’Keeffe at m.okeeffe@frontier-economics.com or call +61 (0)3 9620 4488.

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