Tribunal knocks back Telstra appeal

The decision, while not unexpected, is a blow as Telstra seeks to maximise returns from its copper network, which connects exchanges with subscribers and is vital to competitors' phone and broadband services.

The tribunal concluded Telstra's pricing application was not based on the "efficient cost" of providing the infrastructure. It was not reasonable that the unconditioned local loop "should be priced on the basis of the up-to-date costs of replacing a historical relic while keeping most of its essential design features and merely updating its equipment".

The ruling relates to wholesale pricing from last August to the end of this year.

The ACCC seized upon the decision to back its comprehensive review of wholesale pricing arrangements, which attracted some criticism by Telstra's rivals for rolling over existing pricing for a further year as the review was carried out.

It said the complex legislation encouraged a litigious environment that created great uncertainty and significant costs for Telstra, its rivals and the regulator.