The Australian Competition and Consumer Commission has welcomed the reduction in wholesale Internet rates recently announced by Optus.
Optus' domestic rate for Internet traffic will drop from $120 to $100 per Gigabyte for customers using more than 400 Gigabytes per month. The price decrease follows on the heels of Optus reaching a reciprocal compensation agreement with Telstra. This issue had been the subject of a competition notice served by the ACCC on Telstra and revoked after Telstra reached reciprocal interconnection agreements with Optus and similar Internet Access Providers.
ACCC Commissioner Rod Shogren said these rate reductions are exactly what the competition notice was designed to bring about. "Our competition notice stated quite clearly that the lack of reciprocal compensation meant higher wholesale prices". Commissioner Shogren predicts that Optus' wholesale rate reductions will result in immediate benefits to consumers.
"Lower wholesale price means lower costs for Internet Service Providers, leading to rate reductions at the retail level". The price reductions, coming so soon after issuing a competition notice, are the latest tangible benefit of strong telecommunications regulation for competition and consumers. Although pleased with the lower costs to ISPs and end users, the ACCC will continue to monitor the Internet industry to ensure that new entrants and smaller IAPs are able to reach agreements with Telstra and other larger IAPs, such as Optus.
"We need to make certain that there is no repetition of the conduct complained of in our competition notice", said Commissioner Shogren.
