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Telstra goes for watchdog's throat in broadba -

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Telstra goes for watchdog's throat in broadband battle

Broadcast: 15/05/2007

Reporter: Helen Brown

Optus has been critical of an accusation by Telstra that the Australian Competition and Consumer
Commission (ACCC) is stymieing its $4.1 billion plan to roll out high-speed broadband.


TONY JONES: Telstra took its campaign against the nation's competition regulator to a new level
today. The telco giant ran an ad in the country's leading newspapers criticising the [Australian]
Competition and Consumer Commission for thwarting its ambition to create a high-speed broadband
network. Telstra argues its grand plan is being stymied by overzealous regulation, but the ACCC
says it won't buckle under the pressure. Helen Brown reports.

HELEN BROWN: Telstra is running a campaign to build a $4 billion high-speed broadband network. To
protect its investment, it says it must be done on its terms. It blames the Australian Competition
and Consumer Commission for thwarting its vision, and used this morning's papers for its latest
attack. Later came the added threat, that the billions could go elsewhere if Telstra didn't get its

PHIL BURGESS, TELSTRA GROUP MANAGING DIRECTOR: We have many places we can invest $4.1 billion. If
the Australian people and elected leaders of the country - not the unelected bureaucrats at the
ACCC - but if the elected leadership of the country, and if the voters of the country decide they
don't want broadband then we have other places we can put the money and we'll do it.


HELEN BROWN: The Telstra ads prompted a response rarely seen from the man overseeing competition

GRAEME SAMUEL: If I was to redraft or to draft a reply to the advertisements they'd be very simple
indeed, it would be to publish the same advertisement with the words "what price?" in question
mark, just scrawled right cross it. What price is it that Australian consumers will pay for this
grand plan?

PHIL BURGESS: We have given the prices to the Government, and that's who we're negotiating with.

HELEN BROWN: David Cannon is with an international company that provides advice on
telecommunications technology, and he says Telstra does need to make public how much it would
charge others to use the proposed new network.

DAVID CANNON, SENIOR TELECOMMUNICATIONS ANALYST, IDC: The competitive environment is still very
much in the favour of Telstra, and it would just be a shame to see Australia's broadband future
services be just too expensive for the average consumer to be able to purchase.

HELEN BROWN: But he also thinks that something else might be in play, given that the Labor Party's
plans for a broadband network could see Telstra competing on an open tender.

DAVID CANNON: It's very possible that they are looking to get sign-off on the fibre to the node
proposal prior to the federal election, yes.

HELEN BROWN: The advertisement gives a time line for the Telstra plan, saying it will start
connecting the highest speed broadband to a further 100 exchanges if it gets the government
assurances it seeks. It also shows the new fibre to the node network is only guaranteed to capital
cities. That means Telstra would replace some of its old copper network with optical fibre. But
that would only happen in regional areas if it was deemed commercially viable. The cost of access
is one of the reasons why a group of Telstra's competitors, called the G9 and headed by Optus, are
developing their own plan to build a high-speed network. The group's proposal is expected to be
made public in the next couple of weeks. The ACCC says Telstra and the G9 group both have to reveal
their access charges to ensure they're fair. Helen Brown, Lateline.