Telstr Price Control In Australia

Telus appeared in the late 1990’s by the merger of Alberta-based Telus and BC Telecom in an environment of significant changes for the incumbent carriers who had previously enjoyed a monopolized service offering. Soon after its creation Telus found itself in the early 2000 to be facing major hurdles of maintaining its financing plans. The early 2000 offered an environment of increased competition for telecom companies, saw the crash of the dot-com bubble and offered a weaker business climate as a result of the 9/11 tragedy. Within this environment, the ratings by credit rating companies had a profound influence on how telecom companies would continue to do business.

The Demographic environment relates to the structure of populations (Oxford Dictionaries | English, 2017). The factors that contribute to the demographic environment relevant to this report are location and density of the population.

1.0 IntroductionTelstra Corporation is a telecommunications and information services company. It provides a range of services including fixed line services, Internet access, and business services. Telstra is the market leader in the telecommunication industry in Australia, with one of the most prominent brand names. However, its products and operating services face an increasing threat from competitors. An analysis with recommendations of Telstra marketing is necessary in order to improve its performance.

When consumers decide to purchase a product or service a car, a new refrigerator, or prescription drugs, the goal of the antitrust laws is to make sure their choices are not restricted unreasonably. Consumer choice is a powerful incentive for the sellers of any products to keep their prices low and their quality high. When the antitrust laws are vigorously enforced, businesses must respond to what consumers want. A business that ignores consumer wishes, by refusing either to keep prices competitive or to offer

Antitrust act was a constraint to the industry in order to prevent absolute monopoly. Regulating market is a particular challenge in network industries, where mediating vertical interactions across firms, particularly from workload created or essential facilities is important. Emergence of antitrust policy as the primary tool to regulate competition was beginning to have an impact in the early 1900’s. For decades America has been dealing with an infinite number of antitrust practices. One of the most well known was telecommunication network, where ATT was the dominant for decades; the monopoly has caused great harm to many consumers by paying high price for long distance services. Growing up as a child I remember conversation my parents used to have about telephone bill. I was forbid to use the phone every time the monthly bill was over $600. This monopolistic behavior and price control have changed for the better. The vigorous enforcement of the antitrust law has forced the breakoff of ATT’s monopoly to create the baby

TELUS is regulated under federal laws by the CRTC. The consequence of regulatory proceedings could have a material impact on operating procedures and profitability, such as wireless consumer legislation and new requirement for Internet frameworks may causes extra timing on license transfer and approval. At the same time, TELUS also have certain power to monitor and control the level of non-Canadian ownership of company’s common share (The Telecommunications Regulations) for the purpose of company protection.

In a free market economy, price fixing agreements face two large challenges to their effectiveness. The first is that while the companies participating in a price fixing agreement will benefit as a whole from adhering to the agreement, each individual company has a very strong incentive to cheat on the agreement and charge a market rate. Lowering prices allows the company to pick up additional market share from their competitors and increase profits for themselves above what they would be entitled to under the agreement. The second difficulty arises from the fact that without very high barriers to market entry, the higher prices being charged

Telstra have dominated the telecommunications market for over a century by providing integrated services with vast geographical coverage. Telstra’s main areas of expertise are providing telephone, mobile, internet services and its 3G network to households and businesses across Australia with 9.2 million fixed line services and 9.7 million mobile services. Telstra have strived to be number one in their industry and achieve ultimate customer satisfaction (Telstra website 2009).

The competition and Consumer Act 2010 is administered and enforced by the Australian Competition and Consumer Commission (ACCC) and the Queensland Office of Fair Trading (OFT).

The New Yorker published an article describing how competition affected the Internet market in Britain (Cassidy). They state that U.K. regulators forced incumbent cable and telephone operators to lease their networks to competitors at a cost which enabled new providers to enter the market and bring prices down. Effectively the government regulators forced competition to enter the market resulting in lower prices. For example; Virgin Media, a popular fiber optics provider, can provide speeds of 152 Megabytes for around 32 U.S. dollars and services half of the U.K. ; this could be an effective strategy to implement in the states (Join Virgin Media). The networks simply have to be made readily enterable by viable

Telstra is Australia’s largest and most efficient telecommunications company, which provides one of the best-known brands in the country. They offer a full range of services and compete in all areas of telecommunications both domestically and internationally. Telstra’s vision is to enhance its position as the leading full service telecommunications and information Service Company in Australia as well as to expand its presence internationally. (Telstra Website, 2008)

Rogers Cable is the leader in Canada’s cable television market, with a over 2.3 million cable television subscribers and 500000 internet subscribers. In 1993 the Canadian government relaxed the norms of telecommunications industry followed by an application in 1999, allowing local carriers to change the content of the information passing through their networks. This led to increased competition in the market and the customers enjoyed a lot of choice. As such Rogers Cable focused completely on increasing its subscriber base and

Telstra has a long history in Australia, starting together with Australia Post as an administration division, the Postmaster-General 's Department. Telstra is now completely privatized and has been going through a change to become more client oriented under its late CEO, David Thodey. New CEO Andy Penn is required to expand the attention on development in universal markets. The central government 's National Broadband Network (NBN) is making changes in the business and will see the organization logically offer its copper and HFC systems to NBN Co.

In this market, AT&T may be forced to use restrictive trade practices to increase their services prices and restrict their production (Sjögren and Vifell, 2014). The organization may also in many instances collide with other organizations in the same industry in an attempt to stabilize an unstable market.

This chapter sets out the rationale for price discrimination and discusses the two major forms of price discrimination. It then considers the welfare effects and antitrust implications of price discrimination.