telstra expects end to ull battle

Telstra expects end to a 7 year ULL battle by next week
7/4/06:

Telstra Corp Ltd says a seven year battle over the price it can charge its rivals to rent its copper wire network could end next week.


Australia's largest telco has been in dispute with the Australian Competition and Consumer Commission (ACCC) over the so-called unbundled local loop (ULL) pricing.

But the argument, that has dragged on since 1999, could be about to end, with Telstra chief financial officer John Stanhope on Thursday saying he expects a decision will be made by the ACCC or the government "next week".

"We have had the opportunity to put our case and now everybody knows it, it's time to make decisions," he told journalists.

"And whatever the outcome is then we will make consequential decisions whatever they may be."

The telco wants to charge its competitors $30 per month to rent the copper lines running between its exchanges and a customer's premises.

But the regulator is pushing for Telstra to retain a four band pricing regime - with different prices charged for remote, rural, regional and city areas.

Optus chief executive Paul O'Sullivan on Thursday said that Telstra's management had repeatedly tried to "turn back the clock" on the ULL issue, to when Telstra had monopoly power over key elements of its network infrastructure.

The ACCC's final report is now in the hands of Communications Minister Helen Coonan, who will now decide whether or not to intervene on the decision.

Senator Coonan on Thursday said the decision would be made "soon" but added that ministerial intervention would be "unprecedented".

Stanhope also rebuffed comments made by Treasurer Peter Costello on Wednesday that the government's $23.8 billion Telstra stake had been a "shocking" investment.

"Mr Costello is entitled to his own view," said Stanhope.

"He was obviously referencing the fall in the share price but for investors in this company the dividend streams over the past couple of years have been fantastic."

Telstra has long been rated as attractive by investors because of the annual 28 cents per share dividend, but the telco threatened to cut the payout if regulatory outcomes are unfavourable.

The government has flagged the likely sale of its majority stake, dubbed T3, in the company this year.

Shares in the telco closed down one cent at $3.68, still around half the price set when the government last offered Telstra shares to investors in the T2 float in 1999.

http://www.industrysearch.com.au/news/printarticle.asp?id=19935