Australian regulator rejects broadband proposal led by SingTel

December 18, 2007
Singapore Democrats

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AP
17 Dec 07
http://www.khaleejtimes.com/DisplayArticleNew.asp?xfile=data/business/2007/December/business_December461.xml&section=business&col=

Australia’s competition watchdog Monday rejected a Singapore Telecommunications Ltd.-led plan to build a multibillion-dollar high-speed broadband network in the country, but added it would welcome a revised proposal from the group.

The Australian Competition and Consumer Commission said in a draft decision that the bid proposed by SingTel and eight other telecommunications companies did not have adequate audit mechanisms.

The undertaking gives the network owner a high degree of discretion in unilaterally determining non-price terms and conditions for the 15-year undertaking period, “without independent regulatory review,” commission Chairman Graeme Samuel said in a statement.

“We could not accept so much discretion from a gas, electricity or rail firm. Access seekers would not know where they stood.”

But the regulator said it was generally comfortable with the pricing structured offered by the so-called “G9” consortium, and that it was open to receiving a revised proposal.

David Tudehope, chief executive of consortium member Macquarie Telecom, said “while the proposal was rejected, it shows clearly that the ACCC does view our approach favorably.”

Last year, Telstra Corp. abandoned talks with the ACCC on building a network after failing to agree on price mechanisms.

Broadband was a hot topic during campaigning for Australia’s Nov. 24 elections, and the newly-elected Labor government has said it plans to invest A$4.7 billion (US$4 billion; Ð2.76 billion) to build a high-speed network in partnership with private operators.

The competition watchdog will take submissions on the draft decision until Feb. 4.