Hi Angus,

[Thus spake Angus Tong unto Lewin Edwards:]

 LE> Austel has the power to peg Telstra's prices. Witness the fact that in
 LE> order to encourage competition, Telstra was forced to maintain price
 LE> levels above Optus's for some time (maybe even still).

The above is probably due to the fact that Telstra (being the dominant
carrier) must charge according to their basic carriage service tariffs
while Optus may charge below theirs.

 AT> So they can't monopolise the market by raising prices or lowering them
 AT> so that others can't compete?

Australian competition law (apart from that which is embodied in the
Trade Practices Act) doesn't directly prohibit monopolies or the way
people decide to set prices. What it does prohibit is that a person who
has substantial power in a market (Telstra definitely falls within this
category) must not take advantage of that power for a proscribed purpose
e.g. to eliminate or substantially destroy competitors, to prevent entry
to a market or to prevent competitive conduct.

So when news of the leaked Telstra plan to price out ISPs came out, my
first thought was that Telstra is going to get hammered by Austel or the
ACCC if the plan (a blatant act of predatory pricing) goes ahead. After
all, the maxiumum pecuniary penalty for misuse of market power is $10
million per contravention for a corporation (and a corporation providing
an essential service as Telstra does is going to get hit with the
maximum fine.)

Regards

Sunny
E-mail: sunny{at}fl.net.au

... Who the dickens wrote "Oliver Twist", anyway?
--- Blue Wave/386 v2.30