ACCC issues second Telstra accounting separation reports
The Australian Competition and Consumer Commission today issued two of its second round of reports in relation to the accounting separation of Telstra. They cover Telstra's performance in the December quarter 2003.
One report contains an imputation analysis comparing Telstra's retail prices with the prices of two core* telecommunications access services. This is designed to reveal whether there is a sufficient margin between Telstra's retail prices and the prices it charges access seekers to use its network (plus related costs) to enable efficient firms to compete at the retail level.
The imputation analysis does not apply to the wholesale ADSL service which is the subject of a current ACCC Competition Notice to Telstra.
The second report provides key performance indicators on non-price terms and conditions that compare Telstra's service performance between Telstra's retail and wholesale supplied basic access services.
The ACCC notes that there is little difference between the results in these reports and those of the reports for the previous quarter. The information supplied by Telstra does not reveal any major concerns with how it is providing the specific services covered to access seekers to enable them to compete in retail markets.
Nevertheless, it is largely a matter for Telstra to ensure that the information supplied is accurate. The reports have not been audited yet and the imputation report lacks important information to cross-check what has been provided on this occasion. Accordingly the ACCC is not able to vouch for the complete accuracy of the reports at this stage.
The ACCC has previously expressed reservations about the utility of accounting separation at the theoretical level. It is premature to draw conclusions on a practical level whilst the reporting requirements are still being refined. The ACCC will however provide a fuller assessment of its views of the contribution of the information to the regulation of telecommunications markets as refinements take place and the ACCC's experience in the use of this information grows.
The reports are available in a single document on the ACCC's website. They are also made available on Telstra's website.
* The two core access services comprise the local carriage service and PSTN originating and terminating access. The third core service is the unconditioned local loop service. Telstra is unable to perform an imputation test for this service at present.