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The Sydney Morning Herald

Telstra forced to split retail and wholesale accounts

Author: Cosima Marriner
Date: 10/12/2002
Words: 223
          Publication: Sydney Morning Herald
Section: Business
Page: 21
Telstra will be forced to separate its financial accounts for its retail and its wholesale divisions after new laws were passed in Parliament late yesterday.

The Senate passed the Government's Telecommunications Competition Bill which is designed to improve competition in telecommunications. Under the new law, Telstra will be required to reveal the costs of its retail and wholesale arms every six months. Competitors are relying on the new regime to expose whether the country's largest carrier charges its wholesale customers more to use its network than it charges itself.

The Australian Competition and Consumer Commission will implement the accounting separation within six months, once it has consulted with the industry.

The competition watchdog will analyse Telstra's retail and wholesale accounts to determine whether it is engaging in ``systemic price squeeze behaviour" .

The ACCC will publicly report its findings, with the first report expected at the end of 2003. Telstra will also have to report how the service (including faults and maintenance, ordering, provisioning, availability and quality, billing and notifications) it provides its retail arm compares with that provided to its wholesale customers.

Competitors who wish to connect to Telstra's network can seek access to more commercially sensitive information about Telstra's accounts, which will not be made available to the broader public.

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