Telstra loses patience with Telecom tactics

By Richard Braddell

WELLINGTON - Telstra New Zealand's "doers, not suers" stance is at an end after it yesterday filed court proceedings against Telecom alleging anti-competitive and discriminatory practices.

Telstra has previously taken pride in its ability to compete pragmatically in the New Zealand environment. But its managing director, Peter Williamson, said it had no choice but to go to court after Telecom cancelled re-billing arrangements under which customers with the two companies, and other carriers, can elect to have their bill consolidated into one account.

Mr Williamson said Telecom's move was prompted by Telstra successes in the corporate market which include an agreement signed in December to manage all Fletcher Challenge's telecommunications services.

Telecom's attitude would also have an influence on negotiations Telstra was having with potential corporate customers, he said.

Mr Williamson said that while the re-billing arrangements were a customer choice, the data also enabled Telstra to understand the customer's business and provide appropriate best of breed technologies and services rather than just its own products.

Telecom responded by saying that the re-billing amounted to a simple re-badging of its services which left customers unaware of the true identity of the supplier.

"Re-billing means that Telecom can actually be provisioning, supplying and maintaining telecommunications services directly to a company or organisation, yet have no direct relationship," the external relations manager, Clive Litt, said. Both he and Mr Williamson said they were hopeful of resolution by negotiation.

However, Telstra's concerns go much wider than re-billing. "Telstra cites other commercial concerns including data pricing, interconnect pricing, service level guarantees, onerous access code conditions and unexpected outages," it said.

Mr Williamson said that outages from Telecom that affected Telstra's business had reached unprecedented levels in the first quarter of this year.

Telstra's court action comes a week after WorldxChange complained to the Commerce Commission about difficulties in getting non-code access arrangements in place in circumstances where customers had been using a Telecom call-logging service.

Other carriers are also upset by what they allege is a move by Telecom to reduce data prices for its customers while maintaining prices to other carriers for components of those services. In addition, Telecom has withdrawn letters of authority which enable another carrier to make alterations to installed products.

Asked if the moves by Telecom amounted to a tougher stance towards competitors, Mr Williamson said: "If you look at the list of Telstra concerns, you have to suggest there has been a change of attitude. But that's not the point.

"There are a set of guidelines and rules and mechanisms that are put in place in the marketplace. We are asking everybody to play by those rules."

Mr Williamson has been appointed head of a new US operation, Telstra Inc. However, he said he would remain in New Zealand as long as the current difficulties with Telecom continued.