Telstra Price Control Extended
- Price controls extended until 2012
- Due to Telstra’s almost monopoly on copper wire
- NBN will change the price control need
Minister for Broadband, Communications and the Digital Economy, Senator Stephen Conroy, today announced the extension of retail price controls on Telstra fixed-line telephone services to June 2014.
"This is good news for Australian consumers – untimed local calls will still cost 22 cents, and calls from a payphone will still be capped at 50 cents for a local call. Calls to directory assistance will also remain free of charge for Telstra fixed-line customers," Senator Conroy said.
People on low incomes will continue to be protected under the retail price controls and a range of other measures, ensuring they pay only $22.95 for a fixed-line Telstra service.
The retail price controls will be extended for two years on Telstra's existing networks, but the National Broadband Network will be largely free from retail price regulation. This is because it provides a stronger platform for retail competition and a level playing field for fixed-line suppliers.
"Telstra still dominates the market for fixed-line services on the existing copper network, so it's appropriate for the government to keep retail price controls in place for these services while that network is progressively decommissioned.
"The National Broadband Network will mean true competition in fixed line telephone services for the first time. This is the best way to ensure Australians get the best value phone services. The Government will, however, continue to have measures in place that protect consumers, particularly people on low incomes," Senator Conroy said.
Telstra seems circumspect about the status quo. “As the industry migrates to the NBN the rationale for imposing retail price controls on the industry will become less persuasive,” a spokesman said. “Given this, it’s important that the rationale for these price controls is reassessed as the rolls out proceeds.”