ACCC issues Telstra accounting separation report for September quarter 2007
The Australian Competition and Consumer Commission today issued its seventeenth imputation testing and non-price terms and conditions report under the enhanced accounting separation regime for Telstra. The report presents data for the quarter ending 30 September 2007.
The report tests whether there is systematic discrimination in the price or non-price terms offered to Telstra retail and wholesale customers. It is not intended to detect all forms of potentially anti-competitive conduct.
This report presents an imputation analysis comparing the retail price charged by Telstra with the prices of three core* telecommunications access services. The reported imputation analysis is designed to indicate whether margins are sufficient to allow efficient firms to compete against Telstra in the retail market.
The results for fixed-line voice services show that, although imputed margins for some services or customer segments have deteriorated and others improved, imputed margins across the bundle of services remained relatively constant in the September quarter 2007.
The results for services supplied over the unconditioned local loop core service (ULLS) indicate that imputed margins have improved in the quarter, although they remain negative except when the ULLS is used to supply a bundle of ADSL and voice services to business customers.
The report also presents key performance indicators that compare Telstra's customer service performance in meeting certain non-price terms and conditions for its wholesale and retail fixed-line telephony and ADSL customers. The report does not indicate that material discrimination against wholesale customers occurred in the September 2007 quarter.
The report will be available on the ACCC website.
*The three core access services are the local carriage service, the PSTN originating and terminating access service, and the unconditioned local loop services (ULLS). The ULLS allow a competitor to lease the use of a customer's line to supply any combination of access, voice, ADSL or other data services.
The enhanced accounting separation regime was introduced to address competition concerns arising from the level of vertical integration between Telstra's wholesale and retail services, and also to improve the provision of price and cost information to the ACCC, competing telecommunications service providers, and the public.
On 19 June 2003, the then Minister for Communications, Information, Technology and the Arts directed the ACCC to issue record-keeping rules to Telstra, requiring Telstra to report on:
current costs in addition to historical costs under the Telecommunications Industry Regulatory Accounting Framework (CCA reports)
imputation analysis comparing Telstra's retail prices and the costs faced by access seekers in purchasing certain core telecommunications services from Telstra (imputation reports)
key performance indicators on non-price terms and conditions that compare Telstra's customer service performance between specified retail and wholesale supplied services (NPTC reports).
The direction requires that the ACCC make the reports publicly available and comment on the reports submitted. In accordance with the direction, the ACCC first issued record-keeping rules to Telstra in June 2003. The ACCC issued revised these rules in September 2004.
