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​ACCC petitioned over Telstra 'misuse of market power'

One of Telstra's mobile competitors has accused the telco of misusing its market power and providing "sub standard services" in regional Australia.

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Telstra

Telstra has come under fire for misusing its market power and blocking supply of mobile services to wholesale customers in regional Australia, with one of these telco providers taking a complaint to the ACCC accusing Telstra of anti-competitive conduct.

Business telco provider Macquarie Telecom has lodged an official complaint with the Australian Competition and Consumer Commission, saying "Telstra has misused its market power to lock regional consumers and businesses into substandard services and unfairly limited their choice of mobile providers."

Macquarie contests that Telstra has "refused to supply wholesale services where it has a monopoly mobile network", that it only offers 3G services to wholesale customers rather than 4G, and that is has "forced wholesale customers to impose more restrictive data caps" that it applies itself.

Furthermore, Macquarie argues that Telstra is able to "manipulate the market to anti-competitive ends" by using its retail business to oversee and approve wholesale contracts.

Telstra's mobile network covers more than 2.3 million square kilometres, "over twice what the other networks say they cover" according to the company, and it boasts 4G coverage in "over 300 regional towns across Australia". However, Macquarie Telecom's national executive for industry and policy, Matt Healy, called the telco out for this market strength.

"Telstra's dominance of mobile markets has increased in recent years, and it uses this dominance to prevent competition from gaining a foothold in fixed line and corporate markets as well as by bundling services together," he said.

Macquarie also claims that Telstra has only supplied mobile services in locations where competitors operate, thereby "denying regional consumers any choice at all in other locations", and that this behaviour has occurred just as the Federal Government plans to spend $100 million to address coverage blackspots in regional areas.

"Telstra will no doubt have its hand out for more taxpayer freebies, but its contempt for regional Australians is on full display in its behaviour in wholesale markets," said Healy.

"Macquarie hopes the ACCC moves quickly and decisively to end this monopolistic behaviour."

The CEO of the Australian Communications and Consumer Action Network Teresa Corbin has weighed into the debate, saying regional Australians should not be denied choice when it comes to mobile providers.

"Regional and rural consumers in Australia continue to complain that they lack choice and quality services when it comes to mobile service providers," said Corbin.

"If the behaviours identified by Macquarie Telecom are occurring, then the regulator needs to step in without delay to prevent the abuse of market power."

Telstra has been sought for comment.

Update, July 4 at 12:48 p.m. AEST: Telstra provided the following comment to CNET on Macquarie Telecom's complaint:

The mobiles market in Australia is a vibrant one, with strong growth, sustained high levels of investment, lots of choice for consumers and rapid uptake of new technologies. It is also a very competitive market, with three network operators and many more retailers competing on coverage, service, technology and price.

We have invested billions of dollars building Australia's largest mobile network and delivering the latest technologies to our customers across the country, including in regional and rural Australia. No company has done more to provide telecommunications services to regional Australia and we offer uniform national pricing, so people in the bush enjoy the same prices as people in the city.

We have a strong wholesale mobiles business. We supply wholesale services to 12 MVNO [mobile virtual network operator] customers and we continue to invest in our platform and offering, including announcing we will be increasing our 3G coverage to 98.5 percent of the population and removing the download cap.