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\irow4\irowband4\ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 CCC\cell Competitive Carriers\rquote Coalition\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow5\irowband5\ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 CDMA\cell Code Division Multiple Access is a technical standard for a second generation mobile communications network.\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 CPI\cell Consumer Price Index\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow7\irowband7 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 CTN\cell Consumer Telecommunications Network\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow8\irowband8\ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 FCC}{\fs20\charrsid675166 \cell }{\fs20 Federal Communications Commission (telecommunications regulator in the United States)}{\fs20\charrsid675166 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow9\irowband9 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 FTM\cell Fixed-to-mobile}{\fs20 call}{\fs20\charrsid675166 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow10\irowband10\ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 HiBIS\cell High Bandwidth Incentive Scheme\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow11\irowband11\ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 HFC\cell A Hybrid Fibre Coaxial cable network consists of both fibre optic and coaxial cabling. \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow12\irowband12 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 ISDN\cell The Integrated Services Digital Network is a network that has evolved from the PSTN. ISDN service s enable consumers to send and receive information at faster speeds and with greater reliability than is possible us}{\fs20 ing the standard PSTN service. }{\fs20\charrsid675166 ISDN services are used for the carriage of information such as voice, data, high quality sound, text, still images and video.\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow13\irowband13 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 Minister\cell Minister for Communications, Information Technology and the Arts}{\fs20\highlight4\charrsid675166 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow14\irowband14 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 LCS\cell The Local Carriage Service is a service for local call resale. That is, the carriage of telephone calls from customer equipment at the consumer \rquote s premises to separately located customer equipment of a consumer in the same standard zone. (Standard zones is defined in the }{\i\fs20\charrsid675166 Telecommunications (Consumer Protection and Service Standard) Act 1999}{\fs20\charrsid675166 ). \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow15\irowband15 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 LIMAC\cell Low-income Measures Assessment Committee }{\fs20\highlight4\charrsid675166 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow16\irowband16 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 LSS\cell The Line Sharing Service allows one telecommunications carrier to provide broadband services while another provides voice services, on the same telephone line, at the same time.\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow17\irowband17\ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 LTIE\cell Long-Term Interests of End-users}{\fs20\highlight4\charrsid675166 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow18\irowband18 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 PSTN\cell The Public Switched Telephone Network is the standard}{\fs20 fixed-line telephone network. }{\fs20\charrsid675166 It is primarily used for the supply of long-distance, fixed-to-mobile and mobile-to-fixed calls to consumers in Australia.\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow19\irowband19 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 SMS\cell Short Messaging Service\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow20\irowband20 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 TSLRIC+\cell Total Service Long-Run Incremental Costs, including a contribution to common costs.\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow21\irowband21 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 ULLS\cell The Unconditioned Local Loop Service involves the use of unconditioned lines (typically copper) between consumers and a telephony exchange, where the line terminates. This service enables the supply of advanced, high-speed data services, such as xDSL, to customers as well as local and long-distance voice services.\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow22\irowband22 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 USO\cell Universal Service Obligation\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow23\irowband23 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 VoIP\cell Voice over Internet Protocol\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow24\irowband24 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 WA Government\cell Western Australian Department of Industry and Resources\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow25\irowband25 \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard \ql \li0\ri0\sa240\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid675166 xDSL\cell A generic term for Digital Subscriber Line technologies\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow26\irowband26\lastrow \ts11\trgaph108\trleft-108\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2660\clshdrawnil \cellx2552\clvertalt\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth6006\clshdrawnil \cellx8558\row }\pard\plain \s1\ql \li0\ri0\sa480\keepn\pagebb\widctlpar\aspalpha\aspnum\faauto\outlinelevel0\adjustright\rin0\lin0\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\bkmkstart _Toc87678258}Summary{\*\bkmkend _Toc87678258} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In this report, the 糖心原创 presents its draft views about the current retail price control arrangements that apply to Telstra and the arrangements that should apply in the future. These views follow extensive consu ltation by the 糖心原创 with interested parties through written submissions and in 12 public meetings throughout Australia, including metropolitan, regional and remote locations. \par }\pard\plain \s3\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel2\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Current price control arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that, while the current pri ce control arrangements have provided some benefits to consumers, not all consumers have benefited to the same extent. In addition, some consumers\emdash particularly those that make fewer than average calls\emdash are probably worse off. The 糖心原创 hopes to provide more definitive views on the effect of the current arrangements in the final report, after it receives the necessary data that it requested from Telstra in August 2004. \par }\pard\plain \s3\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel2\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Future price control arrangements \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price cap baskets \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创\rquote s draft recommendation is that price cap regulation should be retained on the services to which it currently applies. Given the 糖心原创\rquote s general preference for broad service baskets, its draft recommendation is that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {a basket containing line rental, local calls, domestic and internationa l long-distance and fixed-to-mobile calls should decrease on average by approximately 5 per cent per annum in real terms, that is, be subject to a price cap of approximately \line CPI\~\endash \~5\~per cent \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {a basket containing only connection services should be subject to a price cap of CPI. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 will consider further whether: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {domestic long-distance calls and international calls, or a sub-set of them, should be excluded from price cap regulation \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {business services should be excluded from price-cap regulation and, if so, how the class of business services to be excluded should be determined. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Incentives to encourage efficiency \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 considers that the next price control arrangements could better achieve the objective of promoting the long-term interests of consumers of telecommunications services. In particular, the 糖心原创 considers that more should be done: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { to encourage efficient investment in telecommunications infrastructure, including investment to promote the deployment of infrastructure used to compete with Telstra (i.e. to promote facilities-based competition) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { to strengthen competition in the supply of line rental and local calls to better ensure that any further increases in line rental prices and offsetting decreases in call prices (i.e. rebalancing) are efficient and that a wider range of plans, based upon demand for calls, would be available to consumers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {to ensure that reasonably anticipated productivity gains are passed on to consumers in the form of lower prices. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {To ensure that Telstra has the appropriate ince ntives to invest in its infrastructure, the 糖心原创 recommends that future price control arrangements penalise Telstra where service quality has deteriorated. To encourage the deployment of infrastructure to compete with Telstra, the 糖心原创 proposes that regul atory approval be sought by Telstra before it changes its prices for particular services in areas where competing service providers are building their own infrastructure. This recommendation will provide greater certainty to potential competitors. \par The 糖心原创 is also particularly concerned about future price increases for line rental and therefore considers that line rental prices should be subject to an additional form of price control. The 糖心原创 will consider further whether the additional control should be a price cap over the entire line rental service or a cap over particular line rental products\emdash HomeLine Part and BusinessLine Part. The 糖心原创 also recommends that it should assess proposed line rental increases prior to implementation. \par The 糖心原创 proposes that future price caps specify a target that is informed by Telstra\rquote s reasonably forecast productivity gains and that the target is not weakened by carry-in from previous price control periods. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Other future price controls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 also recommends that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the current cap of 22 cents on the price of a local call should remain \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the current cap of 40 cents on the price of a local call from payphones should remain, as any increase would be likely to impact heavily on low-income consumers and because the 糖心原创 has not rec eived any cost information that supports a price increase \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { dial-up internet calls to Internet Service Providers should be subject to the 22 cent local call cap. Calls to ISPs were previously made to local geographic numbers, which were required by separate legislation to be charged at no more than the price of a local call. Since then, Telstra has moved calls to ISPs from geographic numbers to a discrete number range (x0198). Although in practice these calls have been charged at local call rates, the 糖心原创 b elieves that the price controls should specify a 22 cent cap \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {direct government initiatives may be a better way to improve access for regional and rural consumers than the}{\charrsid10885908 }{ current metropolitan/non-metropolitan local call relativity provisions. However, the 糖心原创 does not recommend ending the current relativity provisions. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {discounts for line rental for schools would be more appropriately funded through direct government assistance \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Ministerial consideration of directory assistance charges should remain, but not be extended to other ancillary charges. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low income package \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 considers that, while the inclusion of targeted measures to deliver benefits to potentially disadvantaged consumers has been a good initiative of the current price control arrangements, th e current low-income packages do not always deliver such benefits. In fact, some consumers may be worse off under such packages. \par The 糖心原创 believes that future price controls should ensure that low-income consumers not be worse off if they acquire packages designed to assist them. Therefore, the 糖心原创 proposes that a safety net be put in place such that low-income consumers pay less than other consumers regardless of which package they acquire. The 糖心原创 also recommends that access to these discounts be strea mlined for consumers that are registered for relevant Government benefits. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Duration of the future price controls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创\rquote s draft recommendation is that the next price control arrangements should apply for three years. \par \par \sect }\sectd \psz9\pgnrestart\linex0\footery1008\endnhere\sectdefaultcl\sftnbj {\header \pard\plain \s26\ql \li0\ri0\sa240\widctlpar\tqc\tx4153\tqr\tx8306\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\insrsid7488297 \par }}{\footer \pard\plain \s15\qr \fi360\li0\ri360\sa240\widctlpar\tqc\tx4153\tqr\tx8306\aspalpha\aspnum\faauto\adjustright\rin360\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\field{\*\fldinst {\cs25\insrsid7488297 PAGE }}{\fldrslt { \cs25\lang1024\langfe1024\noproof 122}}}{\insrsid7488297 \par }}{\*\bkmkstart _Toc87678259}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 1\tab}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx432\aspalpha\aspnum\faauto\ls20\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Introduction{\*\bkmkend _Toc87678259} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The Minister for Commu nications, Information Technology and the Arts (the Minister) has directed the Australian Competition and Consumer Commission (糖心原创) to hold a public inquiry about the current price control arrangements that apply to Telstra, which are contained in }{\i Telstra Carrier Charges\emdash Price Control Arrangements, Notifications and Disallowance Determination No.1 of 2002}{ (the Determination), and the nature of the price control arrangements that should be established in the future. The current Determination expires on 30 June 2005. \par In conducting the public inquiry, the 糖心原创 is required to consider, among other things, what form any future price control arrangements should take, including their duration, means of implementation, whether any complementary arrangements are nec essary and mechanisms for assessing and enforcing compliance. \par Price control arrangements of the form spelt out in the Determination were first introduced in 1989. Since that time, Telstra (or its predecessors, Telecom and the Overseas Telecommunications Co rporation) has been subject to price controls on a range of telephony services. Price controls, which are considered a key telecommunications consumer safeguard, aim to ensure that efficiency improvements are passed through to consumers in the form of low er prices for telecommunications services in markets where competition is not yet fully-developed. Price controls have also been used as a tool for achieving the government\rquote s social policy/equity objectives. \par Since their introduction, the government has comm issioned periodic reviews of the price control arrangements. The most recent review concluded in 2001. These reviews have proven necessary as the telecommunications industry has gone through a number of changes since 1989. In particular, the telecommunica tions market has evolved from one that was supplied solely by two government-owned enterprises, to one that is now serviced by numerous carriers and carriage service providers. \par {\*\bkmkstart _Toc87678260}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 1.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Making a submission{\*\bkmkend _Toc87678260} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 invites submissions in response to this draft paper. \par The 糖心原创 prefers that all submissions be in writing and publicly available to foster an informed, robust and consultative process. Accordingly, the 糖心原创 will treat all submissions as public documents unless otherwise specified. It is preferred that wher e parties wish to submit confidential information they should provide confidential and non-confidential versions of their submission. In these circumstances, the confidential ve}{r}{sion will need to highlight any such information. \par }\pard \ql \li0\ri0\sa240\keep\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {Submissions can be addressed to: \par }\pard \ql \li720\ri0\sa240\keep\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0 {Mr Sean Riordan\line Acting Director\line Telecommunications\line Australian Competition and Consumer Commission\line GPO Box 520J\line Melbourne VIC 3001 \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {Submissions can also be lodged by e-mail to: sean.riordan@accc.gov.au. }{\b Electronic lodgement of submissions is encouraged}{ in addition to hard copy submission. \par All submissions are requested by }{\b 5pm Friday 3 December 2004}{. \par Enquiries can be made to Sean Riordan on 03 9290 1889 or Elizabeth Carlile on 03\~9290 1953. \par {\*\bkmkstart _Toc87678261}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 2\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Background{\*\bkmkend _Toc87678261} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {This chapter provides background on the scope of th e inquiry and outlines the current price control arrangements that apply to Telstra. \par {\*\bkmkstart _Toc87678262}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 2.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Scope of the inquiry{\*\bkmkend _Toc87678262} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 is required to consider the nature of price control arrangements that apply to Telstra. \par The Determination requires the 糖心原创 to consider, among other things: \par {\listtext\pard\plain\s32 \f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s32\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls5\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { the appropriate form of future price control arrangements, including the composition of baskets and the level of price caps \par {\listtext\pard\plain\s32 \f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}the duration of any such arrangements \par {\listtext\pard\plain\s32 \f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}the means of implementation of any such arrangements \par {\listtext\pard\plain\s32 \f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}whether any other complementary arrangements are required to work in conjunction with the future price controls and, if so, their nature \par {\listtext\pard\plain\s32 \f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}mechanisms for assessing and enforcing compliance. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In conducting the inquiry, the 糖心原创 is directed to have regard to the following matters: \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 (a)\tab}}\pard \ql \fi-363\li363\ri0\sa240\widctlpar\jclisttab\tx363\aspalpha\aspnum\faauto\ls6\adjustright\rin0\lin363\itap0 {the current state of competition in each of the markets the 糖心原创 considers relevant \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 (b)\tab}the impact of the current price control arrangements, and possible future price control arrangements, on: \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 i)\tab}}\pard \ql \fi-357\li714\ri0\sa240\widctlpar\jclisttab\tx714\aspalpha\aspnum\faauto\ls7\adjustright\rin0\lin714\itap0 {competition and the future development of competition, having regard i n particular to the telecommunications anti-competitive conduct regime and telecommunications access regime under Parts XIB and XIC of the }{\i Trade Practices Act 1974}{ (the Act) \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 ii)\tab}the availability, choice, quality and prices of services to consumers and any other impacts on consumers \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 iii)\tab}the telecommunications industry, including on economically efficient investment decisions \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 (c)\tab}}\pard \ql \fi-363\li363\ri0\sa240\widctlpar\jclisttab\tx363\aspalpha\aspnum\faauto\ls6\adjustright\rin0\lin363\itap0 { the distribution of the short-term and long-term community and economic benefits and costs, including the impacts on different types of househo lds and business consumers and geographic areas, from the current price control arrangements and, possible future price control arrangements, in particular, relating to any re-balancing of line rental and call charges \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 (d)\tab}the implications of new and emerging technologies on price control arrangements and of price control arrangements on new and emerging technologies \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 (e)\tab}the appropriateness of the current price control arrangements, and possible future price control arrangements for the protection of potentially dis advantaged residential and business customers in both metropolitan and rural areas. \par {\*\bkmkstart _Toc87678263}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 2.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Current price control arrangements{\*\bkmkend _Toc87678263} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { At present, Telstra is subject to a number of price control arrangements under the Determination. Of these, the 糖心原创 believes the following price control arrangements are of most relevance to this inquiry: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { revenue-weighted price movements for a basket of services containing local, trunk (which includes domestic long distance and fixed-to-mobile services) and international calls must not exceed CPI \endash 4.5 per cent. This means that Telstra is entitled to change the individual prices of these services as long as the aggregate price of all the services in the basket declines by 4.5 per cent annual in real terms (i.e. net of inflation) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {a cap of CPI + 4.0 per cent on a basket of business and residential line rentals \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {a cap of CPI \endash 0 per cent applies to a basket of connection services. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The Determination provides that each price cap is an independent price cap and is not subject to any overall price cap. That is, price movements for each basket do not need to fit within a weighted average price movement for all services. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Other price controls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The Determination also provides for a number of other price controls that apply to a range of services. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The reve nue-weighted average untimed local call price for residential and charity customers in non-metropolitan Australia in a given financial year is not to exceed the revenue-weighted average untimed local call price for residential and charity customers in met ropolitan Australia in the previous financial year by more than 0.4\~per cent. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {The revenue-weighted average untimed local call price for business customers in non-metropolitan Australia in a given financial year is not to exceed the revenue-weighted average untimed local call price for business customers in metropolitan Australia in the previous financial year by more than 0.4 per cent. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {The price for untimed local calls is not to increase above 22 cents for calls made from a residential or business phone, and 40 cents for calls made from a public phone, except in the case of discount plans when a customer may on occasion be required to pay more than 22 cents per local call. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Calls in and between adjacent extended zones, and Bigpond calls made from these zones, are required to be charged as untimed local calls, and a price cap of 27.5\~ cents per 12 minute block applies to preferential calls. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Line rentals charged at residential rates must not be increased without prior consultation with the 糖心原创 and it being satisfied that Telstra has complied with the requirement in clause 22 of the } {\i Carrier Licence Conditions (Telstra Corporation Limited) Declaration 1997 }{to have in place a low-income package. This Declaration includes a requirement that Telstra consult with the L ow-Income Measures Assessment Committee (LIMAC) if it makes changes to the low-income package.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The LIMAC comprises representatives of welfare organisations agreed to by the Minister and is responsible for reporting annually to the Minister on the effectiveness of the low-income package and its marketing by Telstr a, and assessing proposed changes to the package or Telstra\rquote s marketing plan for the package.}}}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra must notify the Minister in advance if it intends to alter charges for directory assistance services, with the Minister able to disallow the proposed c hanges if they are considered not to be in the public interest. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra must offer a line rental service to schools at a price at or below the standard line rental offered to residential customers. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { \par {\*\bkmkstart _Ref85604801}{\*\bkmkstart _Toc87678264}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 3\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar \jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Objectives of price control arrangements{\*\bkmkend _Ref85604801}{\*\bkmkend _Toc87678264} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {This chapter considers the objectives of the control arrangements. \par {\*\bkmkstart _Toc87678265}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 3.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Current objectives of current control arrangements{\*\bkmkend _Toc87678265} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Price control arrangements have been aimed at promoting efficient pricing outcomes in telecommunications markets as well as achieving certain social policy/equity objectives. \par The stated objectives of the current price control arrangements are to: \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 a)\tab}}\pard \ql \fi-357\li357\ri0\sa240\widctlpar\jclisttab\tx357\aspalpha\aspnum\faauto\ls9\adjustright\rin0\lin357\itap0 { promote efficiency in markets not yet effectively competitive and pass on the benefits to consumers \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 b)\tab}protect low-income consumers from any adverse effects of line rental increases \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 c)\tab}ensure rural and remote customers share in benefits from greater competition \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 d)\tab}allow Telstra to gradually rebalance}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Rebalancing refers to the process of increasing line rental prices towards their efficient cost with offsetting decreases in call prices.}}}{ line rentals \par {\listtext\pard\plain\hich\af0\dbch\af0\loch\f0 e)\tab}meet other equity objectives.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Commonwealth of Australia, }{\i Telstra Carrier Charges\emdash Price Control Arrangements\'85\emdash Regulation Impact Statement}{, p.\~4.}}}{ \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Efficiency objectives \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The first major objective of price control arrangements is to promote efficient pricing outcomes. The 糖心原创 has previously identified three major types of efficiency that it believes are relevant to the pricing of telecommunications services: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\i productive efficiency}{\emdash the ability of firms to produce given quantities of services at the lowest possible cost \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {\i allocative efficiency}{\emdash the deployment of resources to those areas of the economy where they are valued most and therefore provide the greatest benefit to society \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {\i dynamic efficiency}{\emdash firms have appropriate incentives to invest, innovate, improve the range and quality of services, increase productivity and lower costs through time. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price control arrangements of the CPI \endash X variety seek to achieve efficient pricing outcomes. The underlying principle of CPI \endash X price controls is that price changes should reflect changes in underlying unit costs. In the current context, \lquote CPI\rquote represents the change in the consumer price index while \lquote X\rquote is a measure of the ability to reduce prices as a consequence of firm or service-specific productivity growth. \par }\pard \ql \li0\ri0\sa240\keepn\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\lang1033\langfe3081\langnp1033 CPI \endash X price controls are designed to: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\keepn\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {limit the ability of Telstra to set prices above costs}{\lang1033\langfe3081\langnp1033 \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {provide an incentive to seek cost efficiencies in order to meet its price control obligations \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {allow Telstra to \lquote rebalance\rquote its prices for greater efficiency. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { To explain, a supplier that has market power may have an incentive to price above cost to extract rents. Such profit-maximising behaviour may be inefficient from a social welfare perspective as it could lead to higher prices for consumers and lower levels of output being consumed. CPI \endash X price controls can help prevent these efficiency losses by limiting the extent to which a firm with market power can price above cost. \par Secondly, a supplier with market power may have less of an incentive to pursue cost efficiencies compared to firms operating in a highly competitive market. CPI \endash X price controls aim to provide an incentive to achieve cost efficiencies in order to meet, and perhaps even exceed, those required by regulation. \par A third justification for having CPI \endash X price controls on baskets of telecommunications services is that they give firms the freedom to structure their prices in a way that efficiently recovers \lquote common\rquote costs of production. That is, the production of a series of telecommunications services often involves a number of \lquote common costs\rquote , which are costs that cannot be attributed to a particular service and are therefore allocated across services. \par {\*\bkmkstart _Toc75771603}{\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Social policy/equity objectives{\*\bkmkend _Toc75771603} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The second major objective of the price control arrangements has been the achievement of certain social policy/equity objectives. The government has been keen to ensure that consumers from different geographic areas and with different income levels are able to have access to affordable telecommunicatio ns services and share in the benefits arising from more competitive markets. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 3.1.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Use of retail price controls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Many submissions noted that retail price controls should continue while market failure or Telstra\rquote s market power persists (e.g. ATUG, p. 2). \par The WA Department of Industry and Resources (WA Government) identifies three market failures that it claims have not yet been fully explored by policy makers: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Facilities-based competition is not the most efficient outcome in areas where the customer base is unable to support more than one facilities provider \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {investment uncertainty, which is largely caused by the reality that telecommunications infrastructure is sunk and irreversible \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {non-price competitive forces in the presence of asymmetric information with respect to the flow of relevant market information between parties. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The WA Government states that, in the absence of comprehensive policy reform to adequately address the above market failures, price controls on essential facility elements should be retained as an explicit second-best option (pp. 4-5). \par According to AAPT, the continued need to constrain Telstra\rquote s retail market power indicates there has either been a failure of the access regime, or a failure of cost pass-through to occur . AAPT considers that employing retail price controls represents a second-best approach to regulation (p. 6). \par AAPT, Optus and Telstra indicate that retail price regulation is not required where an effective wholesale access regime is in place. AAPT notes t hat, provided Parts XIB and XIC of the Act are utilised properly, retail price control should not be necessary for constraining the market power of Telstra or enhancing economic efficiency (p. 6). \par Optus considers that the combination of an effective access regime and likely facilities-based entry makes retail price controls largely redundant (p. 3). The Australian Consumers\rquote Association stated that anticipated technological development is not a basis to discontinue retail price regulation (p.\~3). \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Achieving efficiency objectives \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telstra and the Competitive Carriers\rquote Coalition (CCC) consider that retail price controls are or may be unnecessary to achieve economic objectives, with the CCC emphasising that access and competition regulation could be better used to promote competition in markets thereby obviating the need for controls. \par Many submissions and participants in public meetings considered that retail price regulation should be directed to markets that are not effectively competitive, as the purpose of t he price caps is to simulate the effect of competition in markets that are thought to be inadequately competitive (e.g. Vodafone, p.\~ 2; Optus, Sydney public meeting). Once effective competition is evident, Optus considers that retail regulation should be rolled-back (p. 3). \par Optus argues that caps placed on retail prices are a second-best option to measures that would promote competition, as they do not promote productive or dynamic efficiency (p. 8). \par The Australian Consumers\rquote Association is sceptical of claims that competition alone will deliver efficient outcomes and particularly questions the prospects of effective facilities-based competition describing past initiatives to be a \lquote joke \rquote , and future prospects as \lquote get-out-of jail\rquote cards (pp.\~2\endash 3). Optus considered that additional facilities-based competition has been constrained by capital market aversion (p.\~19). \par The CCC considers that any retail price control arrangements that are introduced must be carefully targeted to be of any effect. The CCC is keen to ensure that any such controls would operate such that non-contestable markets/ segments are unable to cross-subsidise contestable markets/ segments. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Achieving social equity objectives \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The Smith Family believes that the current style of price control can b e effective in protecting the interests of consumers who are either financially disadvantaged or who live in areas that are impacted negatively by present service distribution patterns (p.\~1). \par While not opposed to achieving social equity objectives, a number of submissions questioned whether price control arrangements were the most appropriate mechanism by which to achieve them. Consumer groups consider these arrangements of great importance. \par Telstra and the CCC are against the use of retail price controls to achieve social policy objectives, although Telstra is sceptical that these arrangements would be abolished or that government or industry subsidies would be introduced in order to achieve them. \par Optus submitted that social equity objectives conflict with the long-term interests of end-users (p.\~ 6). Mr Steve Dalby, Chime Communications, noted in the Perth meeting the he did not understand why Telstra, a privatised company, should fund low-income consumers. He considered that other industries do not have the same social equity requirements. \par The Australian Consumers\rquote Association considered that retail price regulation should be used to deliver social equity outcomes unless another delivery mechanism is available (p.\~1) Similarly, Chime noted that, if target ed assistance of disadvantaged groups was not addressed through the price control arrangements, then the government would be morally obliged to address it elsewhere. CTN stated that low-income measures must be mandated (p.\~6). \par Chime did not believe that pr ice control arrangements are the appropriate way to address social equity objectives, considering that a social budget is a more appropriate place for such endeavours. Chime considered that the funding should come out of consolidated revenues. Chime noted that, if it is through the budget, then it is open to public scrutiny and public debate. AAPT considered that an enhanced universal service obligation (USO) regime should be used to deliver social equity outcomes (p.\~ 10). Ms Yvonne Lawrence, Country Women\rquote s Association of Western Australia, noted in the Perth meeting that the recent $100,000 drought relief budget was generally used by recipients to pay telecommunications bills. \par In most public meetings, consumers raised the question of why only Telstra is obliged to provide packages to address social equity objectives\emdash there was a general view from those participants that all telecommunications service providers should offer such packages. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 3.1.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price control arrangements are a tool to help p ursue the dual objectives of promoting efficient pricing of telecommunications services and achieving certain social policy objectives. Both of these broad objectives have legislative backing. \par The guiding principle of telecommunications regulation, including the legislation pursuant to which these price control arrangements would be introduced (the }{\i Telecommunications (Consumer Protection and Service Standards) Act 1999) }{ is to promote the long term interests of end users(LTIE) as that term is defined in the Act. \par The LTIE is promoted by measures that encourage economic efficiency and/ or promote competition\emdash in this context, this would generally require that the price of a service should reflect its cost of supply including a normal commercial return on investment. \par A range of other objectives are specified in the relevant legislation including: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { socially-important telecommunications services are accessible to all Australians, are supplied as efficiently and economically as practicable and are of a quality sufficient to meet the needs of the Australian community \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the equitable distribution of productivity gains \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {promotion of diverse and innovative telecommunications services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {to promote a telecommunications industry that is efficient, competitive and responsive to the needs of the Australian community. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Price control arrangements can be used to help move the prices of telecommunications services closer to those expected in competitive markets. Therefore, price control arrangements can be used to promote efficiency in markets which are not effectively competitive. It follows that, if developments in price-controlled markets result in competition becoming effective, an important part of the rationale for continuation of price controls is removed. \par While price control arrangements can help protect consumers during the transition period from less-than-effective to effective competition, there is also a concern\emdash depending upon the nature of the price control arrangements that are enacted\emdash that they can inhibit the development of competition, efficient investment and the long-term benefits of consumers.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Review of Price Control Arrangements\emdash an 糖心原创 Report}{ , February 2001, p.\~viii.}}}{ For instance, price caps that are too prescriptive may foreclose efficient competitors or may inhibit more efficient pricing. Therefore, the 糖心原创 considers that the arrangements should be structured in such a way that the potential for these adverse outcomes is minimised. Furthermore, in markets experiencing significant changes, the risks and consequences that price control arrangements do not achieve efficiency objectives may b e greater. \par As noted above, price control arrangements seek to achieve the economic objective of efficiency and social policy objectives. However, there can be a tension between these broad objectives. In particular, the pursuit of certain social policy obj ectives may create inefficiencies. For example, policy may require that the prices of supplying telecommunications services to particular consumers do not reflect underlying costs. \par That said, the 糖心原创 recognises the importance of affordable access to esse ntial telecommunications services in supporting effective participation in Australian society. Therefore, the 糖心原创 considers that it is appropriate to balance potential efficiency losses against this in assessing measures to achieve wider social policy ob jectives through the price control arrangements. \par The 糖心原创 recognises that retail price controls are one of a number of alternative or complementary regulatory mechanisms or means by which to deliver economic or wider social policy objectives. \par {\*\bkmkstart _Toc87678266}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 4\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {State of competition in relevant markets{\*\bkmkend _Toc87678266} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In conducting the inquiry, the 糖心原创 is required to have regard to the current state of competition in each of the markets that it considers relevant. \par Assessing the extent of competition in the markets within which telecommunications services are supplied is a key consideration in determining whether possible future price control arrangements should apply to Telstra. \par Current price control arrangements apply to line rental, local call, domestic long-distance, international long-dist ance, fixed-to-mobile and connection services. In this report, the 糖心原创 has also considered the state of competition in markets for mobile services and dial-up and broadband internet services. The markets in which the following services are provided are c onsidered by the 糖心原创 as relevant for the purposes of the review: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {local telecommunications services (i.e. line rental, local call services and connections) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {domestic long-distance call services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {international long-distance call services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {fixed-to-mobile (FTM) call services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {mobile call services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {dial-up and broadband internet services. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { This chapter briefly overviews the factors that the 糖心原创 has considered in this report to measure the effectiveness of competition. These factors are then applied to each of the relevant markets in turn to determine their effectiveness. \par {\*\bkmkstart _Toc87678267}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 4.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Measures of effective competition{\*\bkmkend _Toc87678267} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Judgements about effective competition in markets will often involve consideration of many factors such as number of firms, their market shares, price behaviour, th e presence of natural monopoly characteristics, the height of barriers to entry, and the presence of vertical and horizontal integration. \par For this inquiry, the 糖心原创\rquote s analysis of competition in the markets that it considers relevant is largely confined to consideration of the number of firms, market share, the extent of vertical and horizontal integration and price movements. \par Importantly, the 糖心原创 recognises that various factors may contribute to price movements\emdash including competition and improvements in factor productivity\emdash and that isolating these effects is often difficult. More generally though, the 糖心原创 expects that a \lquote competitive\rquote market can be expected to deliver goods and services to consumers of a given quality at the minimum price and cost. \par {\*\bkmkstart _Ref85446976}{\*\bkmkstart _Toc87678268}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 4.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Local telecommunications services{\*\bkmkend _Ref85446976}{\*\bkmkend _Toc87678268} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Telstra charges retail customers for the initial connection to the network, a continuing line rental charge (differing for business and residential customers) and for local calls. Telstra also wholesales local telecommunications s ervices to service providers and other carriers, so line rental and local calls can alternatively be purchased from resellers. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.2.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The market in which local telecommunication services are provided was overall considered to be the ma rket where competition was the least effective. For example, the Australian Consumers\rquote Association considered that \lquote in our estimation the restraining hand of competition has a particularly faint influence in the local call market\rquote (p. \~2). \par Submissions and participants at the 糖心原创\rquote s public meetings were generally of the view that the residential markets for local telecommunications services are not competitive (for example, CTN, p.\~ 14, Mr Carter, p. 1). However, there was some support for the removal of busin ess customers from the price control arrangements as competition was stronger for those customers. For example, Optus indicated that competition already constrains line rental pricing to around cost in the business market (p.\~ 9). Alternatively, Mr Matt Healy from Macquarie Corporate Telecommunications noted in the Melbourne public meeting that, \lquote \'85 it would be overstating it that business customers are now fully contestable with the markets effectively competitive \rquote . \par Market share data generally showed Telstra\rquote s dominance for local telecommunications services. In particular, Optus and ATUG quoted the 糖心原创\rquote s }{\i Telecommunications Market Indicator Report 2002-03}{ which indicated Telstra\rquote s market share by revenue for basic access at 87 per cent, and its market share for local calls at 77 per cent. \par Many participants, particularly those attending public meetings, argued that the current price of line rental is too high. The Australian Consumers\rquote Association considered that \lquote the line rental cost is one asserted by a prov ider with significant if not monopoly power\rquote (p.\~ 3). However, in the Canberra public meeting, TransACT indicated that the increasing line rental prices, to more closely reflect its costs, assisted in the competitive environment for facilities-based competition. \par Indeed, Optus considered that emerging competitive infrastructure will prevent Telstra from monopoly pricing the local loop (p.\~9). Optus pointed to the 糖心原创\rquote s }{\i Telecommunications Infrastructure in Australia 2002}{ report to show that some facilities-based competition exists in local access markets (pp.\~18-19). Optus also noted that competition appears to be greatest where facilities-based entry in the local loop has occurred successfully (p.\~ 8). Telstra noted that \lquote major investment in satellite broadband infrastructure means that infrastructure-based competition and competition in the customer access markets is not limited to CBDs and metropolitan areas\rquote (p.\~7). \par Conversely, the Australian Consumers\rquote Association asserted that \lquote the notion of facilities based competition in anything but CBD and inter-CBD services has been shown to be a joke\rquote (p.\~ 2). Optus also noted that competition in line rental and local calls is weakest in rural areas (p.\~9). Further, Optus considered that additional facilities-based competition has been constrained by capital market aversion (p.\~19). \par Telstra also argued that \lquote strong access-based competition is another reason why the need for price caps has reduced\rquote (p.\~7). \par In terms of other constraints, Telstra considered that \lquote it is increasingly difficult to argue that mobile services and existing and potential fixed line alternatives do not operate as an effective constraint on fixed services pricing\rquote (p.\~ 7). There were also various suggestions, including that by CTN, that \lquote the rapid growth of Voice over Internet Protocol (VoIP) will pose another significant challenge to the continued popularity of the fixed line service in coming years\rquote (p. \~5). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.2.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In its recent }{\i 糖心原创 Telecommunications Reports 2002-03}{, the 糖心原创 cons idered the market for local telecommunications services (which includes line rental, local call services and connections). \par The 糖心原创 noted in that report that, although a limited degree of competition has emerged since deregulation, particularly at the ret ail level, Telstra remains dominant in most aspects due to its ownership of the only ubiquitous fixed-line local access network in Australia\emdash the customer access network (CAN). \par That said, a reasonable level of facilities-based competition has emerged in th e CBD areas of some capital cities. Evidence of the increased availability of alternative facilities and lower-level regulated access services such as the unconditioned local loop service (ULLS) and local PSTN originating and terminating services led the 糖心原创 to remove access regulation of Telstra\rquote s local carriage service (LCS) for CBD areas. In these areas, the issue is less one that alternative infrastructure does not exist and more one that many of these networks have few customers connected. However, th ere is considerably less facilities-based competition in other metropolitan areas and very little in many rural and regional areas. \par Telstra has a high market share in the local telecommunications market, although this has declined slightly over the price control period. Telstra has estimated a slight decrease in its own market share for basic access services from 81 per cent at 30\~ June 2002, 78 per cent at 30 June 2003 to 75 per cent at 30 June 2004. Telstra has also estimated a slight decrease in its market share for local calls from 79 per cent at 30 June 2002, 76\~per cent at 30 June 2003 to 74 per cent at 30 June 2004.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Telstra, }{\i Annual Review 2002}{, 30 September 2002, p.\~10; Telstra, }{\i 2003 Annual Report}{, 30 September 2003, p.\~35; Telstra, }{\i 2004 Annual Report}{, 13 September 2004, p.\~38.}}}{ \par Customers can choose from a number of alternatives when selecting a supplier of retail local telecommunications services, including Optus , AAPT, Primus, TransACT and PowerTel. This partly reflects that Telstra has estimated that market share for its access lines resold by competitors has increased over the price control period\emdash from 12 per cent at 30 June 2002, 14 per cent at 30 June 2003 to 16 per cent at 30 June 2004. Similarly, Telstra has estimated the market share for resale of its local telecommunications services to have increased over the price control period\emdash from 14\~per cent at 30 June 2002 and increasing by 2 per cent each year.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i Annual Review 2002}{, 30 September 2002, p.\~10; Telstra, }{\i Annual Review 2003}{, 23 September 2002, p.\~11; Telstra, }{\i 2004 Annual Review}{ , 13 September 2004, p.\~9.}}}{ \par The average price paid for basic access services increased in real terms by 12.4 per cent in 2002-03, which follows price increases of 13.2 per cent, 15.2 per cent and 9.8 per cent in the previous three years.}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Further, Telstra\rquote s 2003 Annual Report indicated that despite the 4 per cent decrease in the number of retail lines, Telstra\rquote s implied average yield per retail line increased by 10 per cent, or from around $278 per access line in 2001-02 to $305 per line.}}}{ The average price paid by residential consumer s increased by 16.6 per cent in 2002-03, compared with 7.5 per cent for small business and 0.6 per cent for other business. Overall, since 1999-00, average retail prices paid for basic access have increased in real terms by 46.6 per cent.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Changes in Prices Paid for Telecommunications Services in Australia 1997-98 to 2002-03}{, May 2004, pp.\~102\endash 103}}}{ The most recently available data, Telstra\rquote s 04/05 first quarter market update, indicates that Telstra\rquote s average quarterly yield on basic access increased a nominal 8.98 per cent between the September quarters 2003\_04 and 2004\_05, which would indicate that the upwards trend is continuing.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i 04/05 First quarter market update}{, 20 October 2004, p. \~10.}}}{ \par Counter-balancing the increase in price for line rental to an extent is the decline in the average retail prices paid for local calls in real terms by 30.3\~per cent since 1999-00. However, the 糖心原创 notes that the extent of price decrease s for local calls appears to have slowed substantially over the past two years. The average retail price paid for local call services decreased by 3.8 per cent in 2002-03, compared to price decreases of 11.7 per cent and 17.9 per cent in the previous two years. Price decreases for local calls varied across different consumer groups in 2002-03. For example, \lquote other business\rquote (10.7 per cent) and \lquote small business\rquote (3.7 per cent) consumers enjoyed more substantial average price decreases than \lquote residential\rquote consumers (1.2 per cent).}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Changes in Prices Paid for Telecommunications Servi ces in Australia 1997-98 to 2002-03}{, May 2004, pp.\~104\endash 105.}}}{\charrsid15744877 }{Telstra\rquote s 04/05 first quarter market update shows a 2.04 per cent nominal decrease in quarterly local call yields between the September quarters 2003\_ 04 and 2004\_05.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i 04/05 First quarter market update}{, 20 October 2004, p.\~10.}}}{ \par The 糖心原创 considers that the local telecommunications market is not effectively competitive for residential consumers. However, the smaller price increases for business customers compared with residential customers combined with the facilities-based competition in some CBD areas may indicate that greater competitive const raints exist for the provision of services to business customers. \par In response to Telstra\rquote s suggestion that mobile services may be acting as an effective constraint on fixed-services pricing, the 糖心原创 has previously noted that the growth in traditional \lquote voice\rquote revenues}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab For example, revenues from local call, domestic and international long-distance, and fixed-to-mobile call services.}}}{ has levelled due to falling retail prices and customer migration to mobile and high-speed data services. The increasing popularity of mobiles from improved functionality, portability and coverage may result in consumers moving more calls and minutes from their fixed to their mobile phones. The 糖心原创 estimates that approximately 20 per cent of total call minutes in Australia are mobile call minutes.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Estimated using data from 糖心原创, }{\i Telecommunications Market Indicator Report 2002-03}{, June 2004.}}}{ \par If consumers move calls and minutes from fixed services to mobile services, and calls increasingly operate entirely on mobile networks, Telstra\rquote s revenues from fixed services and termination may become threatened. This suggestion was supported by a recent report from Citigroup, which stated: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Empirical evidence suggests the Australian market is at t he cusp of wholesale migration of voice traffic to mobile services. Fixed voice revenues in Australia could fall by $1.9 billion (27 per cent) in three years, whereas outgoing mobile voice revenues in Australia is forecast to grow by $2.1 billion to $8.6 billion. Our top-down fixed-to-mobile substitution analysis shows that Telstra faces a $849 million revenue deficit by 2006-07.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab M. Sainsbury, \lquote Telstra price hike likely as people go mobile \rquote , }{\i The Australian}{, 13 October 2004, p.\~37, citing a report from Citigroup, }{\i Telstra Corporation Limited\emdash It\rquote s beginning to look a lot like Xmas}{, 11 October 2004.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The \lquote fixed-to-mobile substitution\rquote argument would also suggest that consumers are abandoning fixed lines in favour of mobile ser vices. Increasing line rental charges may encourage cancelling of fixed-line services, particularly among low-income consumers. Additionally, Telstra has reported a decrease in retail access lines supplied (approximately 380\~000 in the past year).}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i Full Year 03/04 Financial Highlights}{, 12 August 2004, p.\~6.}}}{ This ma y be partly explained by customers handing-back second lines (e.g. fax or dedicated internet lines) or business customers substituting from PSTN to ISDN services. As Telstra has previously noted: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The number of basic access lines has decreased in recent yea rs but this has been offset, to some extent, by our success in encouraging customers to adopt alternative access services that have more capabilities, such as ISDN services and new internet access products using ADSL technology.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Telstra, }{\i Annual Report 2003}{ , 30 September 2003, p.\~19.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Further, the 糖心原创 consider s it unlikely that consumers in Australia or other nations with an extensive copper network are completely abandoning fixed-line services or will do so in the foreseeable future. This is because many consumers still depend on the home phone for everyday u se, especially for cheaper calls and connection to the internet. \par The 糖心原创 notes that the argument that fixed-line telephony services are being constrained by potential substitution to mobile services implies a market where mobile services are considered su bstitutable for fixed-line telephony services. Generally, the higher price and lower quality of service of calls from mobile services compared with fixed-line services would indicate fixed and mobile services are in separate markets.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab The 糖心原创 did not consider fixed and mobile services to be in the same market in various decisions: }{\i Mobile Terminating Access Service\emdash Final Report}{, June 2004; }{\i Pricing Methodology for the GSM Termination Service}{, July 2001; }{\i Competition for Long-Distance Mobile Telecommunications Services}{, January 2000; }{\i Local Telecommunications Services}{, July 1999. \par }\pard \s29\ql \li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 { Similarly, Oftel concluded that fixed and mobile services are insufficiently close substitutes to fall within the same market definition in its 2003 markets review. That said, Ofcom has queried how extensively and rapidly fixed and mobile networks will become substitutes for each other in its consultation document (Ofcom, }{\i Strategic review of telecommunications\emdash Phase 1 consultation document}{, April 2004, p.\~26).}}}{ At this point in time , the 糖心原创 considers that mobile services do not act as a constraint on the pricing of fixed-line services.}{\highlight4 }{ \par In relation to constraints provided by other technologies, information presented by Telstra indicates that it has experienced negligible loss of demand to Voice over IP.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Refer presentation by Mr Ted Pretty, Telstra, to analysts, }{\i Future Network Evolution And Product Strategy}{, 22\~July 2004, slide\~41, which indicates the Australian market penetration of Voice over IP for \lquote enterprise\rquote customers at less than 5 per cent, for \lquote SME\rquote s at less that 1 per cent and \lquote consumer\rquote at less than 0.1\~per cent.}}}{ At this point in time, the 糖心原创 does not consider that technologies such as Voice over IP create a constraint on the pricing of local telecommunications services. Internet Telephony is discussed in more detail in Section }{\field{\*\fldinst { REF _Ref8 6558107 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380036003500350038003100300037000000}}}{\fldrslt {8.3}}}{ of this report. \par {\*\bkmkstart _Ref85447195}{\*\bkmkstart _Toc87678269}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 4.3\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Domestic and international long-distance call services{\*\bkmkend _Ref85447195} {\*\bkmkend _Toc87678269} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Domestic long-distance calls are produced using long-distance and local networks (using domestic PSTN originating and terminating access services). International ca lls are produced using terminating services in the destination country, international transmission components, the long-distance network and local networks. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.3.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Many interested parties expressed the viewpoint that competition in mar kets for domestic and international long-distance calls is strong or effectively competitive (e.g. ATUG, p.\~5, Optus p.\~ 35; CTN, Sydney public meeting). This conclusion was reached on the basis that there are many competitors providing long-distance call services (e.g. Optus, p.\~13; Chime, Perth public meeting). \par Market share data generally showed Telstra\rquote s large share for domestic and international long-distance call services. In particular, Optus and ATUG quoted the 糖心原创\rquote s }{\i Telecommunications Market Indicator Report 2002\endash 03}{ which indicated Telstra\rquote s market share by revenue for domestic long-distance call services at 71 per cent, and its market share for international long-distance call services at 62 per cent. \par In the Canberra meeting, TransACT considered tha t retail call costs are subject to competitive pressure and therefore that the costs are driven by competition and not regulation. Mr McKechnie noted in the Adelaide public meeting that the price range for international calls is very good. CTN considered that prices have decreased for these services (p.\~5). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.3.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 considered the markets for domestic long-distance and international long-distance call services in its recent }{\i 糖心原创 Telecommunications Reports 2002\endash 03}{. \par In that report, the 糖心原创 noted that Telstra retains commanding shares of these markets (at both the wholesale and to a lesser extent at the retail level). Telstra\rquote s high market shares arise largely because of its ownership of the only ubiquitous fixed-network and the fact that many consumers purchase these services in a bundle with local call services. Most of Telstra\rquote s competitors continue to rely on access to its network if they want to supply these services, including supply as a bundle. \par The provision of both domestic and international long-distance call services requires a number of fixed-line inputs, including \lquote transmission capacity\rquote as well as PSTN \lquote origination\rquote and \lquote termination\rquote (PSTN O/T) services. While competitors continue to have access to intercapital transmission services from a variety of carriers (e.g. Telstra, Optus, PowerTel, Nextgen) on competitive terms,}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The 糖心原创 monitored prices on all \lquote intercapital\rquote routes during 2002-03. The results of the monitoring program suggested that transmission prices on these routes have declined significantly since 2001. This suggested that competition is operating effective ly in these markets. In addition, the 糖心原创 noted in its recent final report in relation to the review of the transmission declaration that there appears to be effective competition on certain non-intercapital routes. }}}{ they are generally limited to acquiring PSTN O/T from Telstra if they want to provide these services. This reflects the complementary inter-play of facilities and access-based competition in this market. \par While competitors other than Telstra have gained some ground in the supply of both domestic and international long-distance calls over recent years, it appears to have steadied over the price control period. Telstra\rquote s own retail market share estimates show that it had 70 per cent of the domestic long-distance market (in minutes) at 30 June 2002, 66 per cent at 30 June 2003 and 65 per cent at 30\~June 2004. In relation to international long-distance services, Telstra \rquote s market share estimates indicate that it had 51 per cent at 30 June 2002, 53 per cent at 30 June 2003 and 52 per cent at 30 June 2004.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i Annual Review 2002}{, 30 September 2002, p.\~ 10; Telstra, }{\i Annual Review 2003}{, 23 September 2002, p.\~11; Telstra, }{\i 2004 Annual Review}{, 13 September 2004, p.\~9.}}}{ \par Retail pricing trends for these services suggest that a reasonable degree of competition is being sustained in these markets. The retail prices paid for domestic long-distance calls decreased by an average of 4.7 per cent during 2002\endash 03, compared to 8.7 per cent, 6.3 per cent and 9.5 per cent in the previous three years. The price decreases varied across different consumer groups in 2002\endash 03 with \lquote other business\rquote (9.1 per cent) and \lquote small business\rquote (6.8 per cent) consumers enjoying more substantial average price decreases than \lquote residential\rquote consumers (2.4 per cent).}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Changes in Prices Paid for Telecommunications Services in Australia 1997-98 to 2002-03}{, May 2004, pp.\~105-106.}}}{\charrsid15744877 }{Telstra\rquote s 04/05 First quarter market update indicates that Telstra\rquote s quarterly yield on domestic long-distance calls only decreased by a nominal 0.59 per cent between the September quarters 2003\_04 and 2004\_05.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i 04/05 First quarter market update}{, 20 October 2004, p. \~10.}}}{ This may indicate that the decrease in domestic long-distance prices is slowing. \par There are indications that the extent of price competition for international long-distance calls slowed during 2002\endash 03. The average retail price paid decreased by an average of 5.8 per cent during 2002-03, compared to 15.3 per cent, 17.2 per cent and 27.0 per cent in the previous three years. Again, the decreases in prices paid were experienced more by \lquote other business\rquote (15.7 per cent) and \lquote small business\rquote (7.2 per cent) consumers compared with \lquote residential\rquote consumers (3.5 per cent).}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Changes in Prices Paid for Telecommunications Services in Australia 1997-98 to 2002-03}{, May 2004, pp.\~106\endash 108.}}}{ Telstra reported a 0.66\~per cent no minal decrease in its quarterly yield on international long-distance calls between the September quarters 2003\_04 and 2004\_05,}{\cs28\fs18\super\charrsid6048746 }{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i 04/05 First quarter market update}{, 20 October 2004, p. \~10.}}}{ which seems to indicate that the slowing down of price decreases continued during 2003\_04. \par In isolation, slowing price decrease s are not necessarily indicative of reducing competition. They may reflect that the market has reached a certain level of maturity. However, in conjunction with evidence of slowing price decreases, the 糖心原创 considers that prices remain well above cost for these services. \par For example, the 糖心原创\rquote s June 2004 }{\i\charrsid7425024 Accounting Separation}{ report}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\charrsid2232885 糖心原创, }{\i\charrsid2232885 Imputation and Non-Price Terms and Conditions Report Relating To Accounting Separation Of Telstra for The June Quarter 2004}{\charrsid2232885 ,}{\b\charrsid2232885 }{\charrsid2232885 October 2004}{.}}}{ suggests that there is still a significant gap between the revenues earned by Telstra in providing these services and the associated costs. This report showed that the imputed margin}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-357\li357\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab In this context, \lquote imputed margin\rquote means the difference between Telstra\rquote s average retail prices and the access prices plus retail and other costs faced by access seekers in providing the same services.}}}{ for domestic long distance was 61 per cent for residential and 66 per cent for business customers. For international call services, the imputed margin was 37 per cent for residential and 49 per cent for business customers.}{\cs28\fs18\super \chftn {\footnote \pard\plain \ql \fi-357\li357\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\fs20\charrsid2232885 Over a bundle of services comprising line rental, local calls,}{\fs20 domestic}{\fs20\charrsid2232885 long distance calls, fixed to mobile calls and international calls, the imputed margin was 12 per cent for residential and 4 per cent for business customers}{\fs20 }}}{ \par The 糖心原创 considers that the markets for domestic and international long-distance call services are showing encouraging signs of competition. While decreases in retail prices have been greater for business customers compared to residential customers, higher imputed margins for t he services were recorded in the business segment. On that basis, it is not clear whether greater competitive constraints exist in the business segment. \par {\*\bkmkstart _Ref85447298}{\*\bkmkstart _Toc87678270}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 4.4\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Fixed-to-mobile call services{\*\bkmkend _Ref85447298}{\*\bkmkend _Toc87678270} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {FTM call services are retail services provided using the wholesale PSTN o rigination and mobile termination services. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.4.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Both Hutchison and Vodafone are of the view that the market for FTM services is not effectively competitive (p. 2-3, 6). Hutchison (pp.\~2-3) states that the low degree of competition for FTM services will continue to exist due to: \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls8\adjustright\rin0\lin360\itap0 {Telstra\rquote s continued dominance at the infrastructure level such that other suppliers of FTM calls are dependent upon their principal competitor for access to essential inputs \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}a large part of the competition which does exist is dependent on the resale of FTM calls supplied by Telstra \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}the existence of significant cross-subsidisation of selected services through bundling and specific targeting of corporate customers \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}Telstra\rquote s dominant share of all retail telecommunications markets \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}Telstra\rquote s significant degree of vertical and horizontal integration. \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {In the Sydney public meeting, Mr Brian Perkins, ATUG, stated: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs59\charrsid742963 Mobile termination is obviously not a highly competitive area. It is, in fact, a monopoly in each case and that has been well canvassed in the mobile termination determination by the Commission. And I think \'85 that fixed-to-mobile is also quite clearly not a highly competitive service either. In fact, with Telstra\rquote s dominance in the local call area, and the local call access area}{\cs59 , it really means that fixed-to-}{\cs59\charrsid742963 mobile is very much a Telstra determinant}{. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Optus noted that there are numerous carriers and providers competing for long distance services, including the FTM component (p.\~31). Optus and ATUG quoted the 糖心原创\rquote s }{\i Telecommunications Market Indicator Report 2002-03}{ which indicated Telstra\rquote s market share by revenue for FTM services at 74 per cent. \par Vodafone considers that \lquote while there have been some small reductions in FTM prices, these average reductions have been driven by relatively larger reductions for business and corporate customers. (pp. 6-7). Further, Hutchison is of the view that separate markets exist for business and residential users. (p.4) \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.4.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 addressed the state of competition in the market within which FTM are supplied in its recent }{ \i 糖心原创 Telecommunications Reports 2002-03 }{report and }{\i Mobile Services Review\emdash Mobile Terminating Access Service Final Decision. }{In both reports, the 糖心原创 considered the market within which FTM calls are supplied remains far from being effectively competitive despite multiple suppliers at the retail level. \par At the retail level, the 糖心原创 understands that around ten carriers/carriage service providers provide FTM services. In the absence of clear market share figures, a proxy is required. In the }{\i 糖心原创 Telecommunications Reports 2002-03}{ , the 糖心原创 used the information it collects under the regulatory accounting framework (RAF) and other sources to estimate market shares based on the number of fixed minutes that are terminated on mobile networks.}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab For this purpose the RAF only covers the four largest fixed-line carriers\emdash Telstra, Optus, AAPT and Primus.}}}{ The data indicated that Telstra accounts for around 65 per cent of all fixed minutes terminated. As an alternative proxy, market share figures for domestic long-distance calls can be used since the pre-selection de termination requires this and FTM call services (as well as international call services) to be taken as part of a bundle.}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab It is more instructive to look at long-distance call service market sha res as opposed to international call service market shares as several carriers only supply international calls using override codes. }}}{ \par There appears to be a significant degree of price discrimination in the price of FTM calls being offered to residential and business consumers. For example, data provided to the 糖心原创 for the purposes of reporting on the changes in prices paid for telecommunications services shows that in 2002-03 the average price paid by residential consumers of FTM calls was around 27 per cent higher than the average price paid by business consumers (other than small business). \par While the price trends for FTM services indicate that competitive forces in this market are relatively weak on the whole, the trends differ among customer groups. Average real pr ice of FTM calls declined by 2.4 per cent in 2002-03 compared to decreases of 3.2 and 6.2 per cent in the previous two years.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Changes in Prices Paid for Telecommunications Services in Australia 1997-98 to 2002-03}{, May 2004, pp. 108\endash 109.}}}{ However, the report shows that for 2002-03, \lquote residential\rquote consumers experienced an increase in the average real price of FTM of 5 per cent, whereas \lquote small business\rquote and \lquote other business\rquote consumers experienced decreases in the price of FTM services (4.2 and 10.9 per cent respectively). }{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 糖心原创, }{\i Changes in Prices Paid for Telecommunications Services in Australia 1997-98 to 2002-03}{, May 2004, pp.\~79, 88 and 93.}}}{ Between September 2003\_04 and September 2004\_05, Telstra\rquote s quarterly yield on all FTM calls decreas ed by a nominal 5.73 per cent,}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i 04/05 First quarter market update}{, 20 October 2004, p. 10.}}}{ a decrease which Telstra attributed to business segment discounts.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab ibid, p. 5.}}}{ This may indicate that the price discrimination towards business customers is continuing. \par Price trends, in isolation, are not necessarily indicative of the effectiveness of a market. That said, the 糖心原创 has evidence to suggest that the average yield on FTM calls is well above cost, particularly for residential customers. For example, according to Telstra\rquote s }{\i\charrsid13904140 2004 Annual Report}{ , its average yield on FTM calls was 37.8 cents per minute. Data available to the 糖心原创 for the purposes of its }{\i\charrsid13904140 糖心原创 Telecommunications Reports}{ indicates that the average yield received across Telstra, Optus, AAPT and Primus for residential FTM calls, is in the order of 46.3 cents per minute . In comparison, the 糖心原创 estimates that based on a range of domestic and overseas information, the underlying cost of the mobile termination service is substantially lower. \par Further, the 糖心原创\rquote s }{\i Accounting Separation}{ imputation report for the June quarter 2004 revealed that the imputed margin that Telstra earned on FTM services was 14 per cent for business customers and 34 per cent for residential customers. The imputation report assumes the mobile termination charge that a competitor would incur if it ter minated traffic on Telstra\rquote s mobile network, i.e. off-net termination charge, which is substantially above on-net costs. Therefore, actual margins are likely to be much higher. \par Prices of retail FTM services are significantly above cost which appears to be largely the result of mobile termination input costs, and more specifically the price of wholesale mobile termination services.}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The other two key inputs are origination and transmission.}}}{ In the } {\i Mobile Services Review}{, the 糖心原创 estimated the cost of providing the termination service, including a normal profit, lies within a range of 5 to 12 cents per minute. However, the lowest known price of the service available in the market at that time was 21 cents. The 糖心原创 review recommends mobile operators to reduce the price of the terminating service towards cost by Janua ry 2007. \par The 糖心原创 considers that the market within which FTM services are supplied to residential consumers is far from effectively competitive. However, this is less clear for the supply of FTM services to business consumers. \par {\*\bkmkstart _Toc87678271}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 4.5\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mobile services{\*\bkmkend _Toc87678271} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The provisio n of a retail mobile service consists of two elements: the mobile access (subscription) service including connection, a handset and monthly access; and outgoing call services. \par SMS, pre-paid mobile services and CDMA services are also considered separately in this report.}{\highlight4 \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.5.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Vodafone and Optus believe that the mobiles market is effectively competitive, although Vodafone notes that this is contrary to the views of the 糖心原创 (Vodafone, p.\~3, Optus, p. 33-34). \par Mr Paul Fletcher, Optus, noted in the Sydney public hearing that the markets for mobile services \lquote is far and away the most competitive sector of the telecommunications industry\rquote . Optus\rquote submission outlines its arguments as to the intense level of competition in terms of the structure, conduct and performance of the industry: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { market structure is characterised by the existence of multiple market players competing not only for new customers, but also for churn from other networks \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {conduct\emdash driven by competition for new, and to retain, co nsumers as evidenced by carriers offering multiple tariff structures and pricing options; bundling becoming increasingly prevalent for product differentiation; pricing of mobile-to-mobile calls is subject to intense competition \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {performance of the industry is consistent with competitive outcomes with modest industry-wide profitability. (pp.\~33-34) \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Vodafone considers that the market is highly competitive and that competition in the mobiles market has intensified during 2004. Vodafone considers the following as indicators of increasing competitiveness of the market: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the introduction of a range of aggressive and innovative pricing offers (including detailing Vodafone\rquote s own products and promotions) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {investment or planned investment in the development of 3G networks \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {subscriber churn \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {increases in the range and choice of mobile telecommunications products and services (p. 4). \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { CTN noted in its submission that competition in the area of mobile phones has provided benefits to consumers (p. 8). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.5.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 recently found in its }{\i Mobile Services Review}{ report that mobile services are not effectively competitive.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab 糖心原创, }{\i Mobile Services Review\emdash Mobile Terminating Access Service Final Decision}{, June 2004, p.\~99.}}}{ \par In that report, the 糖心原创 noted that the supply of new services on 2.5G and 3G networks may drive further growth and have a competitive impact in the industry in the future. The 糖心原创 also noted that the level of product differentiation in the market could indicate a relatively competitive market. \par However, the following factors suggested that the 糖心原创 should be cautious in assessing the level of effective competition in the market for retail mobile services: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the relatively high level of market concentration in favour of the four national mobile network carriers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the high barriers to effective entry into the market (associated with national geographic coverage and sunk costs) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the apparently high levels of profitability of mobile carriers (particularly those with large market shares) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the relatively high penetration rate of mobile phones and decreasing (or stabilising) average-revenues-per-user. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {On bala nce, the 糖心原创 considered that the structural and behavioural measures of competition did not clearly indicate that the retail mobile services market was effectively competitive at that point in time. \par {\*\bkmkstart _Toc87678272}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 4.6\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Dial-up and broadband internet services{\*\bkmkend _Toc87678272} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {There are variou s technologies and services offered by Internet Service Providers (ISPs) to provide access to the internet. Access to the internet can be provided using a narrowband or broadband connection. Most dial-up services use narrowband connections. Broadband serv ices offer a data rate greater than narrowband and usually do not tie up a telephone line for data, thereby allowing the consumer to make voice calls while accessing the Internet. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.6.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Optus considered that the data market is particularly competitive (p.\~16). Optus also noted: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {more players are entering the broadband market and offering a range of broadband applications and innovative technologies \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {examination of broadband uptake shows phenomenal growth in this data platform over the past several years \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the data market is particularly competitive, as shown by the retail market shares: estimates for 2003 indicate that Telstra has 31.9 per cent market share, while Optus has 11.8 per cent \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {data services are likely to be the revenue drivers of tomorrow\'85 this is forcing carriers to upgrade their network facilities to cope with the ever-increasing demand for capacity and download speeds, in addition to the peripheral services. (pp. 15-17). \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Some submissions and participants in public meetings rais ed concerns with internet pricing. For example, the Australian Consumers\rquote Association suggested that the retail prices may not reflect a fully competitive market, noting that \lquote recent contretemps with regard to wholesale pricing of broadband suggest that consumer pricing bears closer inspection\rquote (p. 5). In the Cairns public meeting, participants noted that dial-up internet is currently at DSL prices. As a result, the participants considered that Telstra has no incentive to upgrade its technology. \par Further, i n many public meetings (particularly those in regional areas), participants noted that they usually had to rely on Telstra to obtain broadband services. Participants generally focused on the difficulties in getting Telstra to upgrade its exchanges to enab le the provision of DSL services. In Dubbo, concern was also raised, and examples provided, of local jobs being lost as a result of the technology not being upgraded. \par That said, in Dubbo and Wagga Wagga, participants noted that the government\rquote s HiBIS and \lquote networking the nation\rquote schemes were encouraging new competitive entry into regional areas. Mr John Clements, in Dubbo, considered that without the government schemes, competitive entry would be unlikely to occur. \par Optus\rquote submission provided detail about a n umber of smaller carriers that have announced commitments to invest in local loop infrastructure to provide broadband services, including through wireless infrastructure (pp. 20). Also, Telstra noted that there has been major investment in satellite broad band infrastructure which provide 100\~per cent coverage across the Australian landscape and greater capability for advanced two-way broadband services (p.\~7). \par Some submissions and participants at public meetings considered that Telstra has attempted to stif le the development of competition for broadband services. For example, Optus noted that broadband growth has occurred despite Telstra managing to delay broadband supply in Australia (p.\~ 15). In the public meeting in Perth, Chime considered that Telstra has manipulated the wholesale market for broadband by: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { maintaining monopoly prices for declared services such as the unconditioned local loop service (ULLS) and line sharing service (LSS) and refusing to negotiate, and adding on related charges for connection /disconnection at inflated prices such that competitive alternatives can not be deployed for the mass market \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {as competitors resell ADSL, engaging in price squeezing by pricing wholesale products above retail products by: \par {\listtext\pard\plain\s27 \f3 \loch\af3\dbch\af0\hich\f3 \'2d\tab}}\pard \s27\ql \fi-425\li851\ri0\sa240\widctlpar\jclisttab\tx851\aspalpha\aspnum\faauto\ls16\adjustright\rin0\lin851\itap0 {requiring wholesale customers to pu rchase other products that could be sourced at competitive prices in the open market \par {\listtext\pard\plain\s27 \f3 \loch\af3\dbch\af0\hich\f3 \'2d\tab}introducing charges for wholesale customers that are not applied to its retail arm \par {\listtext\pard\plain\s27 \f3 \loch\af3\dbch\af0\hich\f3 \'2d\tab}limiting the ability of other firms to add-value or differentiate the product \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {making dial-up products unattractive to encourage migration to broadband products, where the above strategies are deployed \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {discouraging wholesale customers from raising their concerns publicly or with regulators. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 4.6.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Internet services are supplie d to a wide range of consumers including large corporate businesses, small to medium enterprises and residential consumers. These include narrowband dial-up internet services supplied over the fixed-line network (primarily used by residential consumers an d small businesses) as well as high-speed internet services commonly referred to as \lquote broadband\rquote which can be supplied using xDSL, hybrid fibre coaxial (HFC) cable, microwave or satellite technology. \par The number of ISPs supplying internet access has increase d over the price control period. The Australian Bureau of Statistics (ABS) estimated that there were 694 ISPs supplying Internet access at the end of the March quarter 2004, increasing from 563 ISPs at the end of the September quarter 2002.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab A large number of suppliers is not necessarily indicative of an effectively competitive market\emdash for instance, one supplier may still hold a dominant position in the market.}}}{ However, the A BS reports that the number of dial-up subscribers appears to be decreasing, with a fall of 163,000 subscribers from the end of the September quarter 2003 to the end of the March quarter 2004.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Australian Bureau of Statistics, }{\i 8153.0 Internet Activity, Australia}{, , 23 July 2004.}}}{ This appears to reflect a movement by consumers from dial-up to broadband services. \par Telstra\rquote s own estimates indicate that its share of the narrowband internet market has remained relatively stable over the price control period. Telstra estimates that it had 26 per cent of the narrowband internet market at 30 June 2002, 27\~ per cent at 30\~June 2003 and 26 per cent at 30 June 2004. \par There is limited information regarding price trends in relation to narrowband internet services over the market. The 糖心原创 notes, however, that BigPond prices decreased by about 17 per cent over the period July 1998 to July 2002. This is shown in } {\field{\*\fldinst { REF _Ref85711763 \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380035003700310031003700360033000000}}}{\fldrslt {Figure }{\lang1024\langfe1024\noproof 1}}}{ below. \par }\pard\plain \s16\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\bkmkstart _Ref85711763}Figure }{\field{\*\fldinst { SEQ Figure \\* ARABIC } }{\fldrslt {\lang1024\langfe1024\noproof 1}}}{{\*\bkmkend _Ref85711763} Changes in BigPond prices July 1998 to July 2002}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Regional telecommunications inquiry (D. Estens, chairman), }{\i Connecting Regional Australia}{, November 2002, p.\~124.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\pard\plain \ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \f1\fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\object\objemb\objw7129\objh3640{\*\objclass Word.Picture.8}{\*\objdata 01050000020000000f000000576f72642e506963747572652e3800000000000000000000aa0200 d0cf11e0a1b11ae1000000000000000000000000000000003e000300feff0900060000000000000000000000030000000100000000000000001000000200000001000000feffffff00000000000000006e00000000010000ffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffff 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period. At 30 June 2002, the estimated number of broadband services-in-operation was 258\~100, however by 30\~June 2004, this figure had grown to 1\~047\~800. This is shown in } {\field{\*\fldinst { REF _Ref85001003 \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380035003000300031003000300033000000}}}{\fldrslt {Figure }{\lang1024\langfe1024\noproof 2}}}{ below. Much of the growth has been in ADSL services, with the estimated number of services in operation increasing from 97\~200 at 30 June 2002 to 363\~100 at 30 June 2004.}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The 糖心原创 collects quarterly data on the number of broadband connections from the major carriers of broadband services. The data is periodically published by the 糖心原创 in its }{\i Snapshot of Broadband Deployment}{ series. Refer 糖心原创, }{\i Snapshot of Broadband Deployment as at 30 June 2004}{, .}}}{ \par }\pard\plain \s16\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\bkmkstart _Ref85001003}Figure }{\field{\*\fldinst { SEQ Figure \\* ARABIC } }{\fldrslt {\lang1024\langfe1024\noproof 2}}}{{\*\bkmkend _Ref85001003} Growth in broadband services}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Data sourced from: 糖心原创, }{\i Snapshot of broadband deployment as at 30 June 2004}{, .}}}{ \par }\pard\plain \ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\shppict{\pict{\*\picprop\shplid1026{\sp{\sn shapeType}{\sv 75}}{\sp{\sn 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04000000f001080007000000fc020100000000000000040000002d01080004000000f0010100050000000902ffffff0005000000010200000000040000000401 0d000400000002010200070000001b04e20179020900080007000000fc020000000000000000040000002d010100040000002d01020004000000f00109000400 00002d010500040000002701ffff030000001e0005000000010200000000050000000902ffffff00040000002c010000070000001604ea018202000000000400 00002701ffff030000001e0005000000010200000000050000000902ffffff00040000002701ffff030000001e0005000000010200000000050000000902ffffff00050000000902ffffff0005000000010200000000040000002d010100040000002d010500040000002701ffff030000000000}}}{ \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {At June 2003, Australia\rquote s broadband penetration rate (broadband access per 100 inhabitants) of 2.65 per cent lagged well behind the OECD average of 6.06 per cent.}{\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Organisation for Economic Co-operation and Development, }{\i Broadband Access in OECD Countries per 100 Inhabitants (underlying data)}{, June 2003. }}}{ This left Australia ranked 20}{\super th}{ out of the 30 OECD countries, compared to 18}{\super th}{ in the previous year. \par Telstra\rquote s own estimates indicate that it has lost market share in broadband internet services over the price control period. Telstra estimates that it had 62 per cent of the market at 30 June 2002, 50 per cent at 30 June 2003 and 42 per cent at 30 June 2004.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i Annual Review 2002}{, 30 September 2002, p.\~10; Telstra, }{\i Annual Review 2003}{, 23 September 2002, p.\~11; Telstra, }{\i 2004 Annual Review}{, 13 September 2004, p.\~9.}}}{ \par Broadband prices have noticeably decreased in recent times, however differences in speeds and download limits makes it difficult to compare. Telstra introduced new broadband pricing plans on 27 February 2004 under the headline \lquote BigPond broadband a t dial-up prices\rquote .}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i BigPond Broadband at Dial-Up prices}{, media release, 15 February 2004.}}}{ The new pricing decreased Telstra\rquote s entry-level price for broadband services from $39.95 (256k, 0MB included downloads) to $29.95 (256k, 200MB included downloads). Primus has since introduced entry-level broadband plans at $19.95 (256k, 200MB included downloads). \par However, on 19 March 2004 the 糖心原创 issued a Part A Competition Notice to Telstra relating to the pricing of its broadband internet services. The notice, issued under subsection 151AKA(2) of the Act, came in to force on 20 March 2004. The 糖心原创 issued the notice because it believes that Telstra has engaged, or is engaging, in at least one instance of anti-competitive conduct relating to its wholesale pricing of high speed internet services in light of its retail offerings. The co mpetition notice currently remains in force.}{\f38 \par }{The number of competitors providing broadband services is quite high in the CBD areas of many capital cities, reflecting the concentration of a large number of consumers and the demand characteristics of those cu stomers (generally high-volume business customers). Competitors use a variety of alternative infrastructure to provide broadband services in CBD areas. \par The number of competitors vying to provide services to customers in metropolitan and regional areas is l ower than in CBD areas, as metropolitan and regional consumers are more likely to be residential. Given the different demand characteristics and economies of density in these regions, there are less broadband services providers that use their own infrastr ucture. Some broadband entry into regional areas has occurred, often by local council initiative. \par The 糖心原创 has undertaken a number of initiatives to promote broadband competition and take-up, including the declaration of the ULLS in 1999 and LSS in 2002. I t was considered that the declaration of these services would encourage efficient infrastructure-based competition in the provision of xDSL services. To date, however, the 糖心原创 considers that the take-up of these services continues to be slow. For retail competition the preference of both carriers and carriage service providers remains wholesale ADSL services. \par The markets in which dial-up and broadband services are supplied are changing, with significant price movements for broadband services occurring lat ely. As such, it would be premature to form a view as to whether or not these markets will be effectively competitive. Having said that, the 糖心原创 remains concerned that Telstra has acted, and may be continuing to act, in a manner that may hamper the furth er development of competition in the market in which broadband services are provided. \par {\*\bkmkstart _Toc87678273}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 5\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Possible future price control arrangements{\*\bkmkend _Toc87678273} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Chapter 3 noted that the 糖心原创 considers that price control arrangements should only be used in certain circumstances to achieve either economic objectives or broader social policy objectives. This chapter considers the telecommunications services to which future price control arrangements should apply and the nature of those arrangements. \par Price control arrangements can be in the form of price caps applying to baskets of services, consisting of either a single service or a number of services, or take other forms. This chapter first considers price caps and then considers other possible arrangements. However, this chapter does not discuss targeted price control arrangements in respect of low-income consumers\emdash they are discussed separately in chapter 9. \par In subsequent chapters, the 糖心原创 considers the impact of these possible future price control arrangements and, to the extent that current informational constraints allow, the distribution of benefits and costs arising from them. \par Price control arrangements should be reviewed periodically given market and industry developments could occur that open non-contestable markets to effective com petition or discourage competition. Similarly, community expectations and behaviour changes such that access to particular telecommunication services becomes more essential or less essential to support effective participation in Australian society. Theref ore, this chapter also considers the duration for the price controls. \par This chapter also considers whether any other complementary arrangements are required to work in conjunction with the future price controls, and if so, their nature. Finally, this chapter also considers mechanisms that are specified for assessing and enforcing compliance, which are important to maintain the efficacy of price control arrangements. \par {\*\bkmkstart _Toc87678274}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 5.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price cap baskets{\*\bkmkend _Toc87678274} \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Line rentals \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Line rental services are currently in a stand-alone basket and subject to a cap of CPI\~+\~4.0 per\~ cent. \par Most submissions and participants at public meetings supported the inclusion of line rental in the retail price control arrangements. There was, however, limited support for the removal of price controls from retail line rentals. Mr Andrew Sheridan, Optus, noted in the Sydney public meeting: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { We have argued and have put forward evidence to support that it is now the time that we should be considering relaxing controls on line rental. However, I think it is important that we do build in some additional safety mechanism \'85 one of the options that we have put forward is to set some controls at the wholesale level. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Similarly, ATUG supported the removal of line rental for business customers from the retail price control arrangements \lquote but only if the access provisions of the Trade Practices Act can be applied to deliver wholesale prices\rquote (p.\~5). \par Some submissions, including ATUG and CTN, argued that line rental should be in a separate basket (ATUG, p. 4, CTN, p. 4). However, T elstra considered that a line rental specific basket would restrict its ability to recover costs and charge efficiently (pp. 14-15). \par While parties including TransACT and Optus supported the recovery of appropriate returns on Telstra\rquote s access infrastructure, many submissions considered that Telstra\rquote s line rental pricing has reached a level whereby those prices are sufficient to recover the full costs of line rental or that Telstra\rquote s line rental pricing will have reached that level by the conclusion of the cu rrent price-control period. (AAPT, p.\~11, ATUG, p.\~3-4, Optus p. 9). CTN stated that it wants a moratorium on line rental increases (p. 15). \par In response to a question at the Sydney public meeting, Mr Bill Scales, Telstra, outlined the following reasons why line rentals were unlikely to increase even if they were not subject to a service specific price-cap: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {if Telstra increased line rental beyond a reasonable amount, it would lose customers to wholesale customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra considers that it is getting to the point where competition is taking over from regulation as a constraint on prices \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {current uncertainty in the market as to whether substitution to mobiles will occur dampens incentives to increase line rental prices. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Optus also believes that emerging competi tion in the local loop will prevent Telstra from monopoly pricing in at least some market segments, citing the business market as an example (pp. 9-10). However, in public meetings in Wagga Wagga and Dubbo, it was noted that regional and rural customers d o not generally have alternatives to line rental that are becoming available to customers in metropolitan areas. \par CTN also argued that DSL revenues should be considered in determining the appropriate level of line rental prices (p.\~7). \par It was suggested in th e Cairns public meeting that line rental should be discounted where consumers are not able to get ADSL services. Mr Douglas Hall noted that if there is no broadband, the customer can not simultaneously make phone calls and be on the internet. As a result, customers often acquire a separate dedicated dial-up internet line to enable them to be on the internet and receive calls at the same time. The participants considered that this was a reason to lower line rental, maybe by half. \par Mr Bill Scales, Telstra, noted that wholesale customers may complain if this scheme was implemented. \par Conversely, and in response to a direct question from Commissioner Willett, the Cairns participants did not support Telstra charging in excess of the standard line rental fee for a high-quality service, such as fibre-to-the-home. \par Mr Charles Britton, Australian Consumers\rquote Association, stated at the Sydney meeting: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { You would need to make a very careful assessment to the extent to which this . . . cashing . . . out meant that low quality of service became a cost of doing business\'85it [may] be cheaper to provide the payment than it would be to provide the service. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { AAPT argued in its submission that wholesale line rental prices should be subject to price control arrangements (p.\~11): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {To ensur e there is competition in the provision of local call services, AAPT suggests that as of 1 July 2005 the Commission should remove retail price controls and establish the following access regime. If Telstra chooses to continue to increase line rentals as o f 1 July 2005, then the current access price for the declared local carriage service}{\b }{(}{\i\charrsid13904140 LCS}{)}{\b }{ should not increase and should be a capped as a proxy for the cost-based price. However, if Telstra decreases its current line rental price, then the access price for the LCS should be based on a \'93retail minus\'94 formula. AAPT considers this would ensure that access seekers could also pass through any cost savings experienced by Telstra in providing the line, and limit the incentives for Telstra to inappropriately cross-subsidise the line rental service. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { As noted above, at the Sydney public meeting Optus advocated similar controls over wholesale line rental prices to price controls, and also in its written submission. (p.\~30) \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Local calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Local calls are currently a compon ent service within a basket of services which also includes domestic and international long-distance calls, and fixed-to-mobile calls (\lquote the basket of call services\rquote ). The basket is subject to a price cap of CPI \endash 4.5 per\~cent. \par Many submissions and participants at public meetings supported the inclusion of local calls in the retail price control arrangements (e.g. ATUG, p.\~ 2; Chime, Perth public meeting). Chime was particularly concerned about the removal of price controls from local calls as it would impact on its customers who obtain dial-up internet. Conversely, Optus\rquote submission supported the removal of all price control on fixed-telephony services. \par There was general concern at many public meetings over the prospect that Telstra may be permitted to discon tinue supply of untimed local calls. In Wagga Wagga and Perth in particular, there was concern that timed local calls would increase the price of dial-up internet services to regional customers. This was an issue as broadband is unlikely to be an option f or those customers.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The obligation to offer untimed local calls is not a matter that is subject of this inquiry, only the price that should be charged for such calls.}}}{ \par In Wagga Wagga and Hobart, participants questioned why local calls are not free. \par In public meetings in Darwin and regional areas, there was particular concern about the extended zones/wide area call boundaries. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Connections \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Connection services are currently in a stand-alone basket and are subject to a cap of CPI. \par Generally, the inclusion of connections in the price control arrangements was not commented on in submissions or in public meetings. \par One comment was made by Mrs Noela MacLeod, Country Women\rquote s Association of Victoria, in the Melbourne meeting that the cost of connections to customers in rural areas can be extremely high. Mrs MacLeod noted \lquote particularly if you live out in an area and you are the only person along the road and there is a lot of new housing in some areas going in. I mean there is a tremendous cost to these people who just want a service\rquote . \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.4\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Domestic and international long-distance \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Domestic and international long-distance calls are component services within the basket o f call services which is subject to a price cap of CPI \endash 4.5 per cent. \par Optus and the CCC considered that domestic and international long-distance calls could be removed from price control arrangements (Optus, p.13; CCC, p. 4). ATUG supported the removal o f these call services if wholesale regulation is strengthened (pp. 5-6). \par In terms of both domestic and international long-distance calls, Mr Gary Voss, TransACT, commented in the Canberra meeting: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The retail call cost, certainly from our point of view, is under constant competitive pressure\'85.The remarkable drops in the price of data transmission and international and STD calls, most of that, in our case, has been passed directly through to the customer. So we certainly don\rquote t see that price is being driven down by regulation rather than by ferocious competition between providers. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Ms Kelly Madden, Anglicare, noted in the Hobart meeting that the price of international long-distance calls have fallen significantly in the last few years and, consequently, that price decreases have not had to occur on other call services in the basket. \par In the event that the 糖心原创 recommends a continuation of controls, Telstra supports the inclusion of domestic and international long-distance calls in a single broad basket with line rentals, local calls and FTM calls (p. 4). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.5\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Fixed-to-mobile \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { FTM calls are a component service within the basket of call services which is subject to a price cap of CPI \endash 4.5\~per cent. \par Most submissions appear to support FTM calls being subject to a price cap. \par As noted in the 糖心原创\rquote s discussion paper, an issue raised by submissions to the 糖心原创\rquote s }{\i Mobile Services Review}{ was whether FTM services need to be subject to a service specific cap\emdash as opposed to just being included in a broad basket of call services\emdash to ensure that reduced input costs are fully passed on to consumers. This was the main topic discussed in submissions and public hearings. \par Telstra and Optus were opposed to a separate sub-cap being applied to FTM services (Telstra, p.16; Optus pp 31\endash 33). At the Sydney public hearing, Mr Paul Fletcher, Optus, stated: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { We are strongly opposed to the suggestion of a separate price cap on fixed-to-mobile. The 糖心原创 has recently introduced very intrusive regulation into fixed-to-mobile in pursuit of the stated objecti ves, and presumably the 糖心原创 considers that if such intrusive regulation is necessary then it would not think it was necessary to bolster that with something else, as that would tend to suggest a lack of confidence in the original measure that was propose d. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { However, the majority of submissions that responded to the question posed by the 糖心原创 in the discussion paper supported a sub-cap being applied to FTM services (ATUG, p.\~4;CCC, p.\~3; Hutchison, p.\~2, 5; Vodafone, pp.\~5\endash 6). \par The main argument for a service-specific price cap is that this is necessary to ensure pass-through of anticipated MTAS price reductions to retail FTM call prices (Australian Consumers\rquote Association, p.\~4; CTN,\~p\~2,\~ 9). As noted by Ms Rosemary Sinclair, ATUG, in the Sydney public meeting: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { We think that fixed-to-mobile calls should be in a separate market, and this is really a parallel position to our position in the mobile terminating access review that we are really concerned about competition actually delivering pass-through of the mand ated reductions. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Similarly, Mr Charles Britton, Australian Consumers\rquote Association, also considered that the mobile services review and the price control arrangements should work in tandem, noting: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 moving [to put fixed-to-mobiles in a separate basket] wouldn\rquote t, in any way, reflect a lack of confidence in the original determination and, in fact, in our view it would be a necessary corollary. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Some submissions considered that if a fixed-to-mobile specific price cap was preferred, the price cap should be set having regard to the price reductions required by the MTAS indicative price path (ATUG, p.\~6; Hutchison, p.\~2, 6). \par Hutchison argued that there may be two separate markets for fixed-to-mobile calls to residential and corporate customers (p.\~4). Similarly, Vodafone considered that there is a case for the cap to be split between residential and business customers (p.\~ 7). Vodafone also stated that consideration should be given to introducing a cap on fixed-to-mobile services for residential customers only (p.\~7). \par In the event that the 糖心原创 recommends a continuation of controls, Telstra supports the inclusion of FTM calls in a single broad basket with line rentals, local calls and domestic and international long-distance calls (p.\~4). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.6\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mobile services \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mobil e services are not currently subject to the price cap. However, mobile services were subject to the price control arrangements that preceded the current arrangements. \par Interested parties commented on mobile services (including CDMA services), pre-paid mobile services and SMS. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mobile services \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Vodafone and Optus are strongly opposed to the return of mobiles into the price caps on the basis that the market is effectively competitive (Vodafone, pp.\~3\endash 4; Optus, pp.\~33\endash 34). \par Vodafone also warned that including mobiles in the retail price controls that apply to Telstra may \lquote loosen\rquote the controls on Telstra by providing it with the ability to rebalance prices (p.\~4). \par CTN stated that with the increased dependency on mobile services, there is a need to include mobile a ccess charges, flag falls and SMS in price control arrangements especially in respect of those consumers who choose a mobile as their standard telephone service (p.\~10). \par CTN recommended that price control arrangements be used to pass on the benefits of competition to rural and remote consumers who have one choice of provider for fixed and mobile services. CTN stated in its submission that \lquote consumers in regional and remote Australia still have very limited access to telecommunications services. An excellent example is mobile telephones, where CDMA is offered by one carrier and the price and service benefits of competition do not affect those consumers. Price controls are appropriate in such market conditions\rquote (p.\~9). \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Pre-paid mobile services \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In the Hobart me eting, Anglicare noted that its research indicated that 20 per cent of disadvantaged consumers do not have a telephone, and 25 per cent only have a pre-paid mobile phone. The reasons for the movement to pre-paid mobile phones appeared to be the lower upfr ont costs\emdash including that consumers are not required to pay connection costs or reconnection costs when moving location; and the ability for the consumer to control the amount of telecommunications spend. \par Mr Tennant noted in the Canberra meeting that pre-pa id mobiles were particularly popular at the younger end of the consumer market reflecting a lifestyle choice. However, Mr Tennant was concerned that those consumers were not making sensible consumer choices, as they were acquiring one of the more expensiv e products on the market. From his experience at Care Financial Counselling Service, mobile telephones are the more prevalent form of debt in that age group. \par CTN supported the use of price controls to protect vulnerable young consumers who for a variety of reasons\emdash not old enough to sign a contract, deemed a credit risk by service providers due to their age, or no steady income to enable them to sign up for a plan with all of their cost benefits\emdash are unable to acquire other telecommunications products (p.\~8). \par Further, there was concern that young people and low-income consumers are paying excessively high prices for calls through the use of pre-paid mobiles. For example, Anglicare and TasCOSS noted that in calling local numbers from a pre-paid mobile, the cost of the call effectively becomes a timed local call. This was considered a great issue when those users make calls to agencies such as Centrelink, where the caller is often placed on hold for an extended period of time. In light of this, participants in s everal meetings supported a recommendation that all call centres be required to have call-back arrangements. \par Concern was also raised that consumers using pre-paid mobile phones do not get the general consumer protection guarantees that are generally provided to other consumers. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {SMS \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In addition to the inclusion of pre-paid mobile services in the price cap, interested parties advocated the use of price controls to protect disadvantaged consumers in relation to SMS. \par CTN stated in its submission that as Deaf consumers use SMS more than average, price controls on SMS may be appropriate to protect such consumers: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The Australian Association of the Deaf suggests that deaf consumers use SMS at 10 times the average. Uncapped SMS costs therefore disproportionately affe ct the affordability of telecommunications for Deaf consumers. In the interests of equity, price controls on text-based services is needed to protect vulnerable consumers who rely on a heavily marketed and heavily utilised service (p.\~8). \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Ms Corbin further explained CTN\rquote s point in the Sydney public meeting: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { We have had quite a few submissions from our member groups that represent deaf consumers who don\rquote t feel that they have a fair and equitable access to the network because they don\rquote t have any other option\emdash as far as real time options goes\emdash but to use SMS which ends up being extremely expensive for them just to conduct one conversation. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.7\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Internet services \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Dial-up and broadband internet services have not been subject to price control arrangements. \par The Australian Consumers\rquote Association suggested that dial-up and broadband services be subjected to the price cap regime (p.\~6). \par {\*\bkmkstart _Ref87353485}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.8\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 on services and market segments to be subject to price caps{\*\bkmkend _Ref87353485} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that a service or market segment sh ould only be subject to a price cap in order to achieve economic objectives where this would materially align market outcomes with what would be reasonably expected within an efficiently competitive market. As such, whether or not a price cap should be ap plied depends in large part upon the level of competition that is reasonably expected to exist within markets or segments of markets. \par Chapter 4 outlined the 糖心原创\rquote s views on the state of competition in various markets, including those that are currently subject to price control arrangements. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Basic access and local calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 concluded in Chapter 4 that the market for local telecommunications services was not yet effectively competitive, although there may have been some competitive constraints in servicing business customers. \par The 糖心原创\rquote s draft decision is that basic access and local calls should remain subject to price cap regulation.}{\charrsid793758 \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Domestic and international long-distance calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 concluded in Chapter 4 that the markets for domestic and internation al long-distance calls are not yet fully competitive. This was because of Telstra\rquote s high market share in the markets for both types of long-distance calls, the slowing decrease in prices and the fact that prices remain well above cost. \par However, certain submissions argued in favour of omitting domestic and international long-distance calls from future price caps. In their view, competition is developing in the supply of domestic long-distance and international calls. \par In support of this view, it could be expected that the price paid by Telstra\rquote s competitors for the wholesale inputs used by competing service providers to supply domestic and international long-distance calls\emdash the domestic PSTN originating and terminating access service\emdash to reduce over coming years.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Particularly, the 糖心原创 expects the access deficit contribution to be removed from the access price by 2006. See 糖心原创, }{\i Final determination for model price terms and conditions of the PSTN, ULLS and LCS services}{, October 2003, p3.}}}{ \par If so, this should allow greater potential for service providers to charge lower retail prices for these calls and thus promote competition. That said, whether this occurs depends upon the commercial decisions of the service providers. \par However, the 糖心原创 also notes that carriers tend to compete across a bundle of fixed-line services covering domestic and international long-distance calls, and FTM calls (\lquote the pre-selectable bundle\rquote }{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The pre-selectable services are offered as a single basket and a customer cannot pre-select different service providers in respect of different calls. See, for example, ACIF Industry Code, }{\i\charrsid2428141 P}{\i re-Selection\emdash Single Basket}{ \i\charrsid2428141 / Multi Service Deliverer}{, June 1999. }}}{) or the pre-selectable bundle together with line rental and local calls . Omitting domestic and international long-distance calls from the price control arrangements might not accurately reflect the fact that the product is sold to consumers as part of a bundle of fixed-call products. \par The 糖心原创\rquote s draft decision is that domestic and international long-distance calls should be subject to price-cap regulation. The 糖心原创 will, however, consider the matter further in reaching a final decision. \par As part of this consideration, the 糖心原创 will consider whether certain classes of domestic long distance calls or international calls are subject to greater competition than others, such as inter-capital calls}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab There is little evidence of substantial differences between inter-capital calls and other long distanc e calls in the price of calls or the level of competition more generally: of the four fixed-line providers, Optus and AAPT do not distinguish between inter-capital calls and other long-distance calls. Telstra only has an inter-capital rate for HomeLine Bu dget customers calling a capital less than 745km away. However, Primus provides a discount of around 1\~cent a minute during peak times and 3\~cents a minute during off-peak times off its standard domestic long-distance prices for inter-capital calls.}}}{ . \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Fixed-to-mobile calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 concluded in chapter 4 that the FTM market for residential consumers was far from effectively competitive, but that it was likely that there was comparatively more competition in the FTM market for business consumers. \par The 糖心原创\rquote s draft decision is that fixed-to-mobile calls should remain subject to price cap regulation.}{\charrsid5965040 \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Possible exclusion of business customer s \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that although the supply of these services\emdash basic access, local calls, domestic long-distance calls, international calls and fixed-to-mobile calls\emdash to business customers, as a whole, may not have been effectively competitive, there are g rounds to expect that supply to at least some classes of business customers would be subject to greater competition in the lead up to the next price-control period. If so, it may be appropriate to omit the business segment, at least in part, from the pric e control arrangements. \par Before reaching a final view on this matter, however, the 糖心原创 would seek further submissions from interested parties concerning whether business services should be excluded and, if so, how the class of services to be excluded shoul d be drawn. For instance, the class could be drawn so as to exclude supplies to: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {corporate and government customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {business customers requiring more than five lines\emdash i.e. as the class is drawn for the purposes of the }{\i Customer Service Guarantee.}{ \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mobile and Internet services \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In relation to mobile and internet services, while the 糖心原创 does not currently consider that the markets are effectively competitive, the 糖心原创\rquote s draft view is that price caps should not be applied as it is not considered likely that retai l price controls will assist in simulating effective competition in these markets to a material extent. \par The following factors were taken into consideration in respect of mobile services: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {as price control arrangements do not address the underlying reasons for competition being less than effectively competitive, the 糖心原创 \rquote s preferred course of action is to address the factors inhibiting effective competition and use price control arrangements where other pro-competitive reforms can not be implemented\emdash the ACC C would prefer to observe the impacts of its recent }{\i Mobile Services Review}{ before it would consider advocating a re-introduction of a price cap over mobile services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {there is some indication that competition is growing in some segments i.e. the segment of users that spend at least $80 a month on calls, although it is not clear whether this will extend to other segments or the period for which this competition will be sustained. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Suggestions for pre-paid mobile phones, SMS and CDMA price caps to be implemente d were generally made on social equity grounds, that is, to protect potentially disadvantaged consumers. If it is considered appropriate to address these issues by way of price control arrangements that apply to Telstra, the 糖心原创 would consider that this should be done by more targeted measures rather than the introduction of price caps. \par }\pard\plain \s27\ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In relation to dial-up and broadband internet services, the 糖心原创 is not of the view that price caps are appropriate at this point in time.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab However, as discussed later in section }{\field{\*\fldinst { REF _Ref86469350 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380036003400360039003300350030000000}}}{\fldrslt {5.3.1}}}{ , the 糖心原创 considers that other price control arrangements may be appropriate in respect of broadband services. }}}{ This is because: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the markets for these services are currently experiencing significant change, for example in terms of rapidly expanding demand for broadband services, associated substitution away from dial-up internet services and a proliferation of service offerings and price points. In light of this, any price caps may become far removed from the state of the market within a relatively short timeframe \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {arguments in favour of internet services to be included in the arrangements appear to be based on the principle that all consumers should have reasonable access to internet services\emdash the 糖心原创 notes that the Digital Data Service Obligation (DDSO) already goes some way towards this.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The DDSO complements the USO and ensures all Australians have access on request to a data service with a 64 kilobit per second (kbit/s) digital data capability. Services under the DDSO are supplied at commercial prices after industry funded rebates, where appropriate, are taken into account.}}}{ \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.9\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 on structure of baskets \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid7079003 General preference for broad based baskets \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 noted in its }{\charrsid9437548 2001 review}{ that allocative efficiencies are best achieved, in the absence of externalities, when the price of a service equals the relevant marginal cost of producing it. However, where common costs arise in the production of a number of services, a f irm may need to price above marginal cost for some or all of these services in order to recover its cost of production. Pricing above marginal cost will introduce inefficiencies into the markets in question. \par One way of minimising this efficiency loss is f or the firm to use Ramsey pricing. One implication of this pricing is that it may be efficient for a firm to set prices for some of its services well above their costs of production because they have a low own-price elasticity of demand.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Where own-price elasticity of demand measures the responsiveness of the demand for a service to a change in its price.}}}{ Accordingly, sett ing an individual price cap on every service may lead to inefficient outcomes. This is because it could push the price of all services towards cost in a uniform way, rather than encouraging the firm to structure its prices for all services such that it mi nimises the efficiency loss of recovering common costs. \par It can be argued, therefore, that if a number of services should be subject to a price cap, then those services should be included in a broad basket if they share common costs. Under this approach, the firm would still be required to reduce the price of the basket of services as a whole, but will have the freedom to restructure its prices so that it raises prices proportionately more where demand is least sensitive. \par In summary, therefore, where common costs exist, efficiency is best served by applying a price-cap to a broad basket of the services that share these costs. \par A natural implication of this conclusion is that sub-caps, which impose additional restrictions on the movement of the price of service s within the broader basket, are undesirable from an efficient pricing perspective and should generally be avoided unless there is good reason to do otherwise. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid7079003 糖心原创 concern over further increases in line rental prices \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Having said that, the 糖心原创 is particu larly concerned to ensure that any further increases in prices for the line rental service reflect efficient pricing outcomes, and are not made by Telstra simply because it has a greater degree of market power in respect of such services. \par Given the potential for increased line rental prices to more than recover Telstra\rquote s line rental costs within the next price control period, the 糖心原创 would be concerned that any increases in line rental prices may potentially be used to cross-subsidise other services. \par Further, given the greater incidence of rising line rental prices on those consumers that make fewer than average calls, the 糖心原创 considers that call plans should be offered to those consumers on terms that are no worse than those currently on offer. \par As such, the 糖心原创 considers that the greater flexibility to price retail line rentals that is implied by the specification of a single broad basket for ongoing price-controlled services should be moderated by specific arrangements to discourage further rebalancin g that would be made to the detriment of competition or to the detriment of consumers that make fewer than average calls. The 糖心原创 has identified two ways in which this could be done. \par One option is to include a price cap that is specific to the line rental service i.e. to continue the approach taken in the current price control arrangements whereby price increases in the line rental service would be constrained by a CPI \endash X cap. In respect of this approach, it can be noted that it: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {is a direct control over average line rental prices and so actual price movements can be predicted with greater confidence \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {while it has not worked well in the past, the exclusion of at least a class of business consumers would suggest that prices faced by particular consumers woul d be closer to the overall average price \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { as it constrains the prices charged for all line rentals without allowing line rental increases to be offset against reductions in the price of calls, it would prevent the offering of subscription style services\emdash whe reby all calls are bundled with line rental into a single charge\emdash or other plans that feature heavily discounted call plans. \par }\pard\plain \ql \li0\ri0\sa120\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\faauto\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The second option that the 糖心原创 is considering focuses on HomeLine Part and BusinessLine Part}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec } \aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The inclusion of a price control over BusinessLine Part is on the basis at least some business services remain subject to future price control arrangements}}}{\emdash i.e. the Telstra retail services that consist only of line rental and local calls. These are the plans that are acquired by retail consumers who pre-select another carrier for their calls and also operate as the reference price at which Telstra provides wholesale line rental to other service providers. \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { For the most part, wholesale customers receive the pricing plan which only incorporates the basic telephone service with local call rates excluding long distance and fixed to mobile calls (with the \lquote business\rquote and \lquote residential\rquote differentiation still applying).}{\cs28\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i 2004 Annual Report}{, 13 September 2004, p.\~75.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { By restricting the price increases that could be made in respect of these particular retail products, the 糖心原创 considers that there could be a reasonable degree of confidence that further price increases in line rental will be restricted to instances of efficient pricing decisions and that reasonable call plans would be offered to consumers that make fewer than average calls as: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {competing service providers would not be required to pass on any Telstra line rental price increase as it would in the past when there were increases in the HomeLine Part and BusinessLine Part products \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {if customers did not consider the price increase to be appropriate to their circumstances, they would have the option of churning to a competing service provider that offered a more appropriate line rental plan. \par }\pard \s27\ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {There would be a number of elements to this price control arrangement. In essence, Telstra would be obliged to: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {continue to offer a basic telecommunication service consisting of line rental and local calls at prices in line with those at which HomeLine Part and BusinessLine Part are now supplied \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the component prices\emdash for local calls and line rentals\emdash that apply in future being reflective of incremental changes in costs for the respective services and at least mai ntaining relativities with the prices at which those services are supplied under Telstra\rquote s standard call plans. \par }\pard \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {In favour of this approach, Telstra would be able to offer subscription style plans or plans with heavily discounted call prices for those consu mers that wish to acquire them as this particular price control arrangement would not apply to the entire line rental service but rather only one product\emdash the entire line rental service would however remain in the broad based basket. \par Against adopting this approach, it relies upon competing service providers to enter the market and compete around prices charged for local access services. While Optus has recently made some initiatives on this front,}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Optus, }{\i\charrsid2849401 Optus Slashes International Rates and Rolls Back Line Rentals}{\charrsid2849401 , media release, 1 September 2004.}}}{ overall competition in the supply of these services has been particularly weak. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid7079003 糖心原创\rquote s draft view \par }\pard\plain \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that all ongoing services that are recommended to be subject to a price cap \emdash line rental, local calls, fixed-to-mobile calls and possibly domestic and international long-distance calls\emdash should be included in a single broad basket.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab As noted in section }{\field{\*\fldinst { REF _Ref87353485 \\n \\h }{ {\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380037003300350033003400380035000000}}}{\fldrslt {5.1.8}}}{, the 糖心原创 is to consider further whether domes tic long distance and international calls or at least a class of them should be excluded from the price caps. Similarly, the 糖心原创 is to consider further whether services supplied to at least a class of business consumers should be excluded.}}}{ The once-off costs associated with connection services to residential consumers may indicate that a separate basket is appropriate for these services. \par In addition, the 糖心原创 considers that a discrete price cap should apply to either the line rental service as a whole, or to the basic telecommunications service consisting of line rental and local calls only. The 糖心原创 will include in its final report a recommendation concerning which of these options should be included in the p ossible future price control arrangements. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.1.10\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of 糖心原创 on level of price caps on baskets \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid14369540 The broad based basket of line rental and calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 considers that for this basket of services, it would be appropriate to determine a price cap of CPI-X where: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {CPI is the historical eight capital average CPI recorded in the year to the previous March quarter \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {X is around 5.0 to 5.5 per cent. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创\rquote s approach to determining a reasonable price cap and in measuring its constituent elements is more fully discussed in Attachment A. \par In setting this price cap, the aim is to determine the capacity for Telstra to reduce the prices of the price-capped services as a consequence of TFP growth. Setting an X on this basis will mean that productivity improvements are pas sed on to consumers in the form of lower prices. \par The 糖心原创 has first assessed the productivity improvement that could reasonably be anticipated for Telstra as a whole\emdash this was done having regard to both historical and forecast data. The 糖心原创 considers that this would provide an upper limit to the X that could be set for this basket of services. \par The 糖心原创 has then determined a reasonable X within this upper bound for this basket of services. In the 糖心原创\rquote s view, there are two approaches to doing this. First, a ttention can be directed at measuring the change in outputs and the change in inputs for the price-controlled services only. This has a particular difficulty in isolating the shared inputs that are attributable to a relatively narrow range of services. \par Second, and in response to this difficulty, it could be recognised that the price-controlled services are produced in association with a number of other services, and that Telstra\rquote s ability to reduce costs of any of these services is related to the growth in TFP of this broader production facility. Specifically, this broader entity comprises the PSTN, the ISDN overlay and xDSL-based services using unconditioned copper loops. The additional services that are supplied from this broader production facility incl ude leased lines, ISDN and xDSL services. \par The 糖心原创 has undertaken both analyses, and its decision on \lquote X\rquote has been guided by the results of each of them. \par Finally, the 糖心原创 has deducted the estimated economy-wide productivity improvement from the productivit y gains estimated for this basket of services to arrive at an X of around 5.0 to 5.5. This recognises that economy-wide productivity measures are already reflected in the CPI value. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid14369540 The basket }{ consisting of connections}{\charrsid14369540 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that this price cap should be set at CPI, where CPI is }{\charrsid593022 the historical eight capital average CPI recorded in the year to the previous March quarter}{. \par At this time, the 糖心原创 does not consider that there are likely to be substantial productivity improvements in the connections service that would necessitate an X being set so as to pass through such improvements to consumers in the form of lower prices.}{ \charrsid593022 \par {\*\bkmkstart _Toc87678275}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 5.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Other price control arrangements{\*\bkmkend _Toc87678275} \par {\*\bkmkstart _Ref85696115}{\*\bkmkstart _Ref85696777}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.2.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar \jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Metropolitan/Non-metropolitan price relativities{\*\bkmkend _Ref85696115}{\*\bkmkend _Ref85696777} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The price control arrangements currently require: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The revenue-weighted average untimed local call price for residential and charity customers in non-metropolitan Australia in a given financial year is not to exceed the revenue-weighted average untimed local call price for residential and charity custo mers in metropolitan Australia in the previous financial year by more than 0.4\~per cent. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {The revenue-weighted average untimed local call price for business customers in non-metropolitan Australia in a given financial year is not to exceed the revenue-weigh ted average untimed local call price for business customers in metropolitan Australia in the previous financial year by more than 0.4\~per cent. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Submissions indicated that Telstra\rquote s dominance in regional and rural areas is signif icant and that the likelihood of facilities-based competition developing in many of those areas is less than for metropolitan areas. Rural customers may therefore not share in the benefits of competition. \par Optus\rquote submission presented its own analysis suggesting that the cost of carrying a call in metropolitan and rural areas may not be as disparate as indicated by Telstra (p.\~ 26). Optus suggested that it might be appropriate to maintain the current local calling relativities until there is evidence of competition emerging in rural areas (p.\~27). \par There was a general concern about the higher cost of telecommunications services in rural areas. As noted in the Melbourne meeting by Mrs Noela MacLeod, Country Women\rquote s Association of Victoria, consumers are sometimes disadvantaged by distance. The following points were raised in several public meetings, for example: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Mr Chris Ryan noted in the Dubbo meeting that he has dial-up internet but his connection continually drops out. As a result, Mr Ryan has to continually r e-dial, raising the cost of the internet service. Mrs MacLeod queried in the Melbourne meeting whether such drop-outs were an inducement to encourage people on to broadband. However, Mr Ryan was advised that ADSL was unlikely to be deployed to his regiona l exchange \lquote in the next 10 years\rquote . \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { Mr Anthony Chan noted in Wagga Wagga that an income disparity already exists between metropolitan and regional areas, as the cost of other services such as petrol and groceries were also higher in regional areas. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {The WA Go vernment stated in its submission that regional and some metropolitan customers are already facing substantial disadvantage in the availability and cost of telecommunications services. Removing or relaxing price controls is likely to exacerbate this disad vantage (p.\~7). \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Mr John Clements, representing Mr Tony Windsor, MP, noted in the Dubbo meeting that if the current relativity was removed, then Telstra would increase the price of calls to his area. Mr Clements argued that the current relativity created the marketplace in regional areas, as the market does not operate efficiently and it is too expensive for competition in smaller communities. Mr Jeff Caldbeck, also in Dubbo, considered that the current relativity should remain from a public policy perspecti ve, and also that Telstra had the social responsibility to ensure that it remained. \par ATUG commented in its submission (p.\~13), and reiterated at the Sydney public meeting, that it considers that \lquote regional users should have access to the same services at the same prices and levels of services as urban-based customers\rquote . As a result, ATUG considers that the geographic relativity provisions should stay. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The local call pricing relativity requirement is intended to ensure that customers in n on-metropolitan areas have access to local calls at prices that are close to those in metropolitan areas. As noted later in section }{\field{\*\fldinst { REF _Ref86469716 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380036003400360039003700310036000000}}}{\fldrslt {7.2.2}}}{, the price of local calls in non-metropolitan areas is on average within 5\endash 10\~per cent of the average price charged by Telstra for local calls as a whole. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Past studies suggest that there is a disparity between the cost of supplying local call services in metropolitan and non-metropolitan areas. Although the precise amount by which the cost of s upplying local calls in non-metropolitan areas differs to the cost of supplying such calls in other metropolitan areas is not known, it would be the case that the cost per call would be materially greater in non-metropolitan areas. This is in a large part due to fewer services-in-operation in those areas and much less demand per service-in-operation for local calls. \par While the local-call relativity requires Telstra to price local calls in non-metropolitan areas proximate to the price of local calls in metrop olitan areas, Telstra has faced relatively weak competition in local call markets. In these circumstances, the effect of this requirement has been that customers in metropolitan areas have paid higher prices and customers in non-metropolitan areas have pa id lower prices than they are likely to have paid other things being equal. \par The likely consequences of this are: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {since the resulting prices for local calls represent price\endash cost disparities, Telstra\rquote s pricing will be relatively inefficient \emdash this means that Telstra would have to charge more on average for local calls than it would otherwise have to charge in order to recover its costs in supplying local calls from the revenues that it derives from them \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {consumption and investment decisions in both metropolitan and non-metropolitan areas will be distorted with investment by competing service providers in non-metropolitan areas becoming relatively less likely\emdash this will tend to entrench the limited competition in non-metropolitan areas. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 accepts that there may be similar efficiency losses from the low-income scheme. However, the social equity grounds for those efficiency losses are more clear-cut in that case. Comparatively, it cannot be said that all rural consumers, regardless of income, would be unable to pay for relatively higher local call services if the current local call geographic relativity was removed. \par The 糖心原创 notes the comments made in submissions and at public meetings that rural consumers already face generally higher costs and poorer telecom munications service quality. This can be seen as a symptom of the lower levels of competition in non-metropolitan areas. \par It can be noted that removal of the local-call relativities may have more pronounced consequences for non-metropolitan customers that u se dial-up internet services, as dial-up internet calls are charged at untimed local call rates. It has been argued that non-metropolitan customers experience relatively greater incidence of call loss than metropolitan users necessitating more calls. Acce s s to the internet without a phone call, e.g. broadband, is more restricted in non-metropolitan areas. Retaining the current geographic relativity may protect consumers from more excessive dial-up costs which would further erode the quality of internet ser vices in non-metropolitan areas. \par Overall, there are two conflicting objectives present in the current local call geographic relativity. There is an efficiency consideration in allowing prices to accurately reflect the cost of delivering the service. Agains t this there is a social equity objective in achieving some price equality in non-metropolitan areas where competition is less viable. \par The 糖心原创 considers that the local call relativity requirement can create inefficiencies in the provision of local call services, and as discussed in section }{\field{\*\fldinst { REF _Ref87334715 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380037003300330034003700310035000000}}}{\fldrslt {9.4}}}{ , other mechanisms, such as government subsidies, could be used to deliver more equitable conditions for non-metropolitan consumers. \par {\*\bkmkstart _Ref85696717}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.2.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Untimed local calls{\*\bkmkend _Ref85696717} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The price control arrangements curr ently require that the maximum price for untimed local calls is generally 22\~cents for calls made from a residential or business phone, and 40\~ cents for calls made from a public phone, except in the case of discount plans when a customer may on occasion be required to pay more than 22\~cents per local call. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mr Duncan Kerr, MP, noted in the Hobart meeting that he considered the 22\~ cent cap on local calls to be an equity measure. However, submissions and participants at public hearings did not generally otherwise comment on the cap, except to note concern about suggestions that Telstra intended to introduce timed local calls. \par The public meetings and submissions noted the potential importance of payphones to disadvantaged groups. There was general support for the retention of the 40 cent cap on public payphones. \par Mr Duncan Kerr, MP, noted that the cap of 40 cents for public phones is very important for low-income consumers. In the public meeting in Sydney, CTN noted that disadvantaged c onsumers often rely on payphones for making local calls and benefit from the current 40 cent cap. \par In both the Darwin and Alice Springs public meetings, it was noted that remote indigenous communities tend to rely on payphones. \par Anglicare noted in the Hobart meeting that payphone utilisation is higher in Tasmania than elsewhere. At the same meeting, Mr Kerr said that he felt that either payphones that previously existed have been moved to other locations or \lquote they are simply gone\rquote . If there is a decreasing num ber of payphones, Mr Kerr considered that measures to better ensure the availability of Telstra payphones should be considered as there is not much point having a cap for local calls made from payphones that do not exist. In that meeting, Telstra noted th at there were approximately 1000 payphones in Tasmania as required by the universal service obligation. \par In its submission, CTN strongly stated that price caps on payphones must remain at the current rate. CTN also stated that the price of phone calls from some private payphones is around 60 cents for twenty minutes (p.\~ 10). CTN stated that the price of calls from payphones in remote communities and by low-income consumers should be controlled (p.\~11). \par The WA Government noted an Australian Communications Authority recommendation that the 糖心原创 consider an increase in the price cap on local calls from Telstra payphones. The WA\~Government considered that \lquote the implied argument is that relaxing the price cap will remove an inadvertent margin squeeze on non-Telstra payphone providers\rquote . In response, the WA Government noted: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {non-Telstra payphone providers are not compelled to supply payphone services in unprofitable areas \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra receives a universal service subsidy as compensation for providing payphones in unprofitable areas (p.\~10). \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {22 cent cap on local calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In relation to the 22\~ cent cap on local calls, interested parties have not advocated or provided any information in support of a change to the current arrangements. \par While Telstra has claimed in previous inquiries that its costs of supplying local calls are above the 22 cent cap,}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab 糖心原创, }{\i\charrsid7230012 Review of Price Control Arrangements\emdash an 糖心原创 Report}{, February 2001, p.\~80. }}}{ those claims included a contribution to the access deficit in addition to actual costs. \par While the 糖心原创 has not undertaken a detailed cost study, it notes: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {removing the contribution to the access deficit, then Telstra\rquote s previous estimates would put the cost of a local call below the current cap \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the process of rebalancing has meant that the \lquote access deficit\rquote has reduced significantly \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {hence any contribution that local calls would be required to make to that access deficit has been similarly reduced. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Further, the 糖心原创 understands that the current average price of a local call that Telstra charges is significantly below the current cap of 22 cents. \par In light of the above, the 糖心原创\rquote s draft view is that the current cap on local calls should be retained, but there may be a need to review the cap in the future. \par It is noted that the current price control arrangement provides an exception to the 22\~cent maximum price where a customer chooses a line rental product that is priced below the standard Telstra line rental plan.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The standard plan is defined as the most popular plan.}}}{ The 糖心原创 recommends that the scope of this exception be considered further given that the 糖心原创 understands that the standard line rental plan is now HomeLin e Plus and that the cap does not apply to a significant proportion of residential customers. The issue is also considered in chapter\~}{\field{\*\fldinst { REF _Ref84242550 \\n \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380034003200340032003500350030000000}}}{\fldrslt {9}}}{ in the context of local calls supplied to low-income consumers. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {40 cent cap on local calls from payphones \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 notes the Australian Communications Authority\rquote s }{\i Payphone Policy Review}{ report finding that payphones have a proportionally higher usage by disadvantaged people and are therefore important for social equity (p.\~24). The viewpoints outl ined in public meetings reiterated the importance of payphones to potentially disadvantaged consumers. \par The Australian Communications Authority\rquote s report also stated that conditions exist for a body such as the 糖心原创 to consider an increase in the price cap o n local calls from Telstra payphones, but any decision would require a balancing of several conflicting goals. \par The 糖心原创 notes Telstra\rquote s submission to the Australian Communications Authority\rquote s review supported the removal of price caps to \lquote provide increased ability for Telstra to fund investment in new payphone products and booths\rquote (Australian Communications Authority report, p.\~33). Telstra\rquote s submission to the Australian Communications Authority also stated that removal of the cap would potentially encourage greater competition in the industry as \lquote new entrants saw fresh and viable opportunities for operating in niche markets\rquote . Telstra\rquote s submission to the discussion paper for the 糖心原创 price control review did not make any comments regarding the payphone price cap. \par The 糖心原创 also notes that the Payphone Industry Association\rquote s submission to the Australian Communications Authority review recommended that the cap be increased to 50 cents or for a formula-based process to be used to allow for appropriate automatic i ncreases over time. Conversely, the Australian Council of Social Service opposed an increase in the price cap, advising that is was important to many low-income earners, and noting that in some other markets telecommunications call prices are falling, not increasing (Australian Communications Authority review, p.\~33). \par While arguments have been made in other contexts to support the increase in the price cap on payphones, the 糖心原创 has not received any oral or written submissions that advocate such an increase during the course of this inquiry. The 糖心原创 therefore has no information on which to assess the need for a change in the price cap. However some points can be made at this time. \par While noting the inefficiencies that may arise through the existence of the price cap, the extent of these is moderated by: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telstra receiving some subsidies through the USO in connection with its supply of payphones \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra\rquote s plans to use its payphone infrastructure to supply wi-fi broadband services in some areas\emdash which has implic ations for some of the cost categories that should be attributed to payphones on a forward-looking basis and Telstra\rquote s incentives to maintain payphones in those areas}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab M Sainsbury, \lquote Telstra to share rival's 3G network\rquote , }{\i The Australian}{, 13 July 2004.}}}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the price cap applying only to payphones located in places where the public typically has access or in detention centres but not in other areas \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the price cap applying only to local calls and not other calls that can be made from a payphone. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { While it is the case that retaining the 40 cent price cap will have some influence on the prices that c an be charged for local calls from all payphones, and hence will affect the ability of other service providers to supply payphone services in competition with Telstra, the extent of this effect would not be absolute as: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the price control arrangement has a direct effect only on Telstra. There is some evidence}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab As per the submission from CTN.}}}{ that it is possible to charge higher amounts for local calls from non-Telstra payphones\emdash either by directly charging a larger fee or indirectly by restricting the duration of calls \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the price control arrangements do not affect other calls that can be made from payphones. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In summary, the 糖心原创 has not received any information to suggest that current prices of local call made from payphones are impeding the recovery of costs. If a case was put to the 糖心原创 on economic grounds for an increase in the cap on local calls from payphones, the 糖心原创 would consider the matter further. In doing so, the 糖心原创 would have regard to any effect that the higher price may have on potentially disadvantaged consumers and whether other mechanisms may exist by which to provide appropriate incentives for payphone operators, should any be considered necessary. At this stage, however, the 糖心原创 would support the retention on the current cap on local calls made from payphones. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.2.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Calls in relation to extended zones \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Under the current arrangements, calls in and between adjacent extended zones, and BigPond calls made from these zones, are required to be charged as untimed local calls. Telstra receives a government subsidy in relation to the supply of these calls. \par The current price control arrangements also specified a price cap of 27.5\~cents per 12\~minute block for preferential calls until these calls were charged as untimed local calls. The 糖心原创 understands that Telstra now charges these calls as untimed local calls and accordingly this provision is redundant. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In the Dubbo public meeting, Mr John Clements spoke in favour of the charging of calls within extended zones as local calls. Mr Clements considered that the extended zones should be specified by a regulatory body by way of disallowable instrument.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab This i s an instrument that takes effect when it is issued but can be revoked\emdash or disallowed\emdash by Parliament.}}}{ \par No other comments were made by interested parties on this subject. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {There are 102 extended zones which collectively cover 80 per cent of Australia\rquote s land area. Around 40,000 services are supplied in an extended zone.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Australian Communications Authority, }{\i Consumer Fact Sheet\emdash Untimed Calls at Local Call Rates and Upgraded Services for Remote Australia}{ , updated 15 July 2004 <}{\charrsid13652651 http://www.aca.gov.au/consumer_info/fact_sheets/consumer_fact_sheets/fsc33.htm}{>.}}}{ \par As extended zones are in areas with relatively few consumers, it is likely that charging these calls at a similar price as an untimed local call would prevent Telstra recovering th e cost of these calls from the prices it charges for them. Whether this is the case and the extent of any disparity between price and cost would depend upon a number of factors. \par However, as Telstra receives government subsidies to price these calls the same as untimed local calls, the concerns that the 糖心原创 would otherwise have about the pricing of calls at below cost\emdash higher prices for other consumers or services\emdash do not arise here. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.2.4\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Dial up internet charges \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {When the current price control arrangements were e nacted, dial-up internet calls were made to geographic numbers and ISPs typically maintained a point of presence in each local call area that they serviced. \par In these circumstances, the legislative requirement to supply untimed local calls and the price co ntrol arrangements meant that these calls could be charged at no more than a local call, and that roughly the same average price had to be charged in non-metropolitan areas as was charged in metropolitan areas. \par As such, the current price control arrangemen ts have dealt with dial-up internet calls only incidentally, by specifying that this pricing arrangement should be made available by Telstra to its BigPond customers in extended zones. This provision implies a policy that dial-up internet access should be available at the price of an untimed local call. \par However, since the current price controls were enacted, access calls to many ISPs have been migrated away from the geographic number ranges to the 0198 numbering range. Telstra\rquote s practice has been to charge the same for 0198 calls as for local calls. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In the Perth public meeting, Chime noted that there would be considerable impact on dial-up internet customers should access calls no longer be charged as untimed local calls. In that hearing, and also in the Wagga Wagga hearing, it was stated that the issue has relatively greater consequences for the supply of internet services in non-metropolitan areas. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {While Telstra\rquote s practice has been to charge the same for 0 198 calls as for untimed local calls, the 糖心原创 notes that that unless the price control arrangements are varied this pricing may not continue. \par To the extent that the dial-up internet calls are less reliable in non-metropolitan areas than in metropolitan ar eas, and broadband access is less available, any move away from pricing dial-up internet calls for untimed local calls would have greater consequences for non-metropolitan consumers. \par In the 糖心原创\rquote s view, the price control arrangements should be varied to treat 0198 calls made to ISPs in the same way as untimed local calls. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.2.5\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Line rental for schools \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Under the current price control arrangements, Telstra must offer a line rental service to schools at a price at or below the standard line rental offered to residential consumers. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {No comments were made by interested parties on this subject. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 understands the basic principle for this price control arrangement. That said, the 糖心原创 does not have any information on: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the total demand for line rental services by schools \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the materiality of the benefit to schools of receiving discounted line rental, particularly as a proportion of operating expenditure. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Given the information deficiency, the 糖心原创 does not have any basi s on which to make an assessment of the importance of the price cap or any associated efficiency losses. \par Furthermore, the 糖心原创 considers that price control arrangements may not be the most appropriate tool to provide subsidies to schools. If it is desirab le to supply line rental services to schools at residential rates, then it may be more appropriate that such subsidies are directly funded by the government. Direct funding may minimise the potential for any efficiency losses, and would appear feasible gi ven the existing arrangements for government funding to be provided to schools. \par Given the above, the 糖心原创\rquote s draft view is that this control should not be included in future price control arrangements. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.2.6\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Directory assistance and other incidental charges \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Curren tly, changes to directory assistance charges are required to be notified to the Minister in advance, with the Minister able to disallow the proposed changes if they are considered not to be in the public interest. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Both the Australian Consumers\rquote Association and CTN supported the application of price control arrangement to additional charges levied by Telstra on consumers, including late payment fees, account keeping fees, contract exit fees, credit card charges that are being pass ed on to customers, charges for bills, etc (ACA, p.\~6, CTN, Sydney public meeting). \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 notes that it is intended for charges to be subject to Ministerial notification and disallowance where they would have a competitive impact on other service providers or impact on community interests and expectations.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Commonwealth of Australia, }{\i Telecommunications (Consumer Protection and Service Standards) Bill 1998\emdash Explanatory Memorandum}{, 1998, p.\~116.}}}{ \par The 糖心原创 currently considers it unlikely that the nature of the incidental charges or the current levels at which they are charged would lessen competition to a material exte nt. As such, the 糖心原创 would only consider that these charges should be subject to Ministerial oversight where they impact on community interests and expectations. \par }\pard \ql \li0\ri0\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {In the 糖心原创\rquote s view, while the directory assistance charges can impact on the interests of the community as a necessary service for the making of calls, the other incidental charges would generally not have such an impact. Having said that, it is noted in section }{\field{\*\fldinst { REF _Ref86479776 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380036003400370039003700370036000000}}}{\fldrslt {9.5}}}{ that incidental charges have the potential to impact more adversely on low-income consumers.}{\b\i \par {\*\bkmkstart _Toc87439134}{\*\bkmkstart _Toc87678276}{\*\bkmkend _Toc87439134}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 5.3\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Incentives to encourage efficient investment{\*\bkmkend _Toc87678276} \par {\*\bkmkstart _Ref86469350}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.3.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Measures to encourage sustainable facilities-based competition{\*\bkmkend _Ref86469350} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { An issued raised in submissions is whether the next price control arrangements could be structured in a way to encourage sustainable facilities-based competition. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Optus argued that price control arrangements should be structured such to promote efficient investments. Although Optus notes that competing service providers have been able to invest in some facilities, in the years following the \lquote technology crash \rquote it has been more difficult to raise necessary capital to do so and that (p.\~19): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85 facilities-based competition requires a long-term view to be taken by regulators. Investment will not happen overnight. In fact, most investment decisions are based on timeframes of at least 3 to 5 years. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {More generally, Optus considers that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the telecommunications industry is on the brink of a period of significant change which is likely to see a significant assault on Telstra \rquote s dominance of the local loop \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the actions of government in setting price controls can and will impact the pace and level of this change (p.\~21). \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Optus considers that the key decision to be made in relation to the promotion of fa cilities-based competition is whether to allow margins to remain in voice services in order to promote investment. Optus favours the retention of these margins (p.\~21). \par Telstra considers that it is important that under the retail price control arrangements Telstra and other service providers can expect to recover the cost of successful investments (p.\~10): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Telstra and its competitors are all likely to adopt different investment strategies. These strategies in many cases are still uncertain or, at least, likely to evolve with new technological opportunities and changes in consumers\rquote needs. It is vital that, whatever choices telecommunications carriers and service providers make, the Government ensures that }{\i successful}{ investors can expect an appropriate return on risky investments. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Telstra submits that there should be limits to which price control arrangements or other forms of regulation should encourage investment in telecommunications facilities (p.\~10): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85 the regulatory approach needs to anticipate change, but not seek to determine outcomes. In other words, the regulatory strategy that emerges from this Review of Price Control Arrangements should be designed to let markets\emdash not regulations\emdash fulfil the role of identifying the services and businesses that will succeed. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In the Melbourne public meeting, Mr Matt Healy, Macquarie Corporate Telecommunications, suggested that Telstra should be excluded from receiving a subsidy to deploy alternative infrastructure, particularly in rural and regional areas, on the basis that such deployment entrenches its market power in those areas. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 considers that the current price control arrangements should provide greater certainty to investors that efficient investment costs would be able to be recove red. In the context of investments made by competing service providers, this requires that Telstra\rquote s pricing would not seek to foreclose an efficient competitor, for example, by seeking to constrain the competitor\rquote s addressable market or by pricing at a predatory level. \par While it could be considered that there would be some novelty in specifying more general pricing principles or other price control arrangements to promote sustainable facilities-based competition, it can be noted that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {such a role for price control arrangements has always been contemplated}{\loch\af12\hich\af12\dbch\af12 \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {similar arrangements have been used previously to better ensure that effect was given to measures to protect low-income consumers}{\loch\af12\hich\af12\dbch\af12 \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the need for greater certainty to promote efficient investment in new teleco mmunications infrastructure facilities has been recognised by government in enacting the anticipatory exemption provisions in section 152ATA of }{\charrsid6322863 the}{\i\charrsid4789358 }{\i Trade Practices Act 1974}{\cs28\fs18\super \chftn {\footnote \pard\plain \ql \fi-357\li357\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\fs20 Commonwealth of Australia, }{\i\fs20 Telecommunications Competition Bill 2002 Explanatory Memorandum}{\fs20 , 2002, p.\~3.}}}{ \emdash the current proposal would complement those provisions by providing certainty for facilities-based competitors.}{ \loch\af12\hich\af12\dbch\af12 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Therefore, to provide greater certainty to Telstra and competing service providers, the 糖心原创 recommends that regulatory consideration be required before pricing initiatives are implemented. \par The arrangements could either requi re 糖心原创 consent to a proposed pricing initiative, or make them disallowable by the Minister. In the latter case, the 糖心原创 notes that when enacting the relevant statutory provisions, it was considered that it would be appropriate to require proposed prices to be notified and subject to disallowance by the Minister where: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85 a reserve power to scrutinise is desirable }{ \i given the competitive impact of certain charges on other service providers }{or on community interests and expectations [emphasis added]}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-357\li357\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Commonwealth of Australia, }{\i Telecommunications (Consumer Protection And Service Standards) Bill 1998 - Explanatory Memorandum}{, 1998, p.\~116.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Therefor e, the Minister could direct Telstra not to implement the notified prices until such time as a report from the 糖心原创 has been considered.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Such arrangements are able to be made under section 155 or 157 of the }{\i Telecommunications (Consumer Protection and Service Standards Act) 1999\emdash }{see sections 156 and 158.}}}{ \par There would be a number of elements to the arrangements that the 糖心原创 proposes: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the services or market segments that would be subject to the arrangement}{\loch\af12\hich\af12\dbch\af12 \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the factors that would be relevant to consider in determining whether a proposed price change should be allowed \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the period of notice to be given in respect of a price alteration}{\loch\af12\hich\af12\dbch\af12 \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the information to be given in relation to a price alteration}{\loch\af12\hich\af12\dbch\af12 \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the period of time within which a decision should be made in respect of a proposed price alteration.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab These are elements that Parliament contemplated being specified in price control arrangements that impose a requirement for 糖心原创 consent. Refer Commonwealth of Australia, }{\i Telecommunications (Consumer Protection and Service Standards) Bill 1998 \emdash Explanatory Memorandum}{, 1998, pp\~114\endash 5.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { To provide greater certainty to Telstra and competing service providers concerning the services, market segments or geographic areas t hat would be subject to these arrangements, the 糖心原创 considers that it should notify their scope as new investment commitments are made, as well as the duration for which the arrangements would apply in respect of particular investments. It would be a mat ter for those considering an investment in competing telecommunications facilities to seek to have a notice issued. \par An important element of such arrangements is that regulatory consideration would be required before pricing initiatives could be implemented. \par These measures would focus on the services that competing service providers would supply by means of the relevant facilities. The business models of such service providers are usually based upon the supply of broadband services, the price-controlled serv ices, and in some instances pay television. \par The types of pricing decisions that should require assessment would include: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {ongoing access and usage charges \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {initial connection or installation fees \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {customer premise equipment such as modems, routers and set-top units \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {bundling or other discounts made available as a result of acquiring the service (regardless of the charges against which the discounts are to be credited). \par }\pard\plain \ql \li0\ri0\sa240\keepn\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Important considerations as to whether proposed pricing was objectionable would be: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\keepn\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the exten t to which it was tailored to meet the new service, for instance, by being offered only in the geographic area in which the new service is to be offered as opposed to all areas or all areas with similar average-cost characteristics \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {whether the pricing was likely to be below the efficient cost of the competing service or Telstra\rquote s service. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { While some parties have argued for the setting of more permissive price targets as a means to encourage investment in telecommunication facilities by competing service pro viders, the 糖心原创 would see some difficulty with such an approach as more permissive price targets: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { provide mixed incentives for existing service providers as more substantial returns would be able to be earned on existing investments (to the extent that Telstra priced up to the price targets) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {provide relatively weak signals for competitive entry since higher maximum prices would of themselves be unlikely to be indicative of prices following entry \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {given that sufficient margins are already available to compet ing service providers that are as least as efficient as Telstra, permit market entry by less-efficient service providers or the use of less-efficient technologies (to the extent that Telstra priced up to the price targets) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {imply that anticipated future services should be in part funded by current end-users of traditional voice telephony who may not be able to access those services or value them. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Implementing any such scheme could prove problematic, as a judgment would need to be made as to what technologies should or should not be accommodated and what increments to current prices were necessary to ensure they were commercialised. \par If financial encouragement is considered necessary to invest in new technologies, delivering this by way of direct government sub sidy or tax allowances tied to actual investments made would be more effective than allowing higher prices for existing services and less detrimental to efficiency. \par Based on the above, the 糖心原创 would not recommend that discrete increments be built into the price targets. Having said that, there are significant margins available on the current price-controlled services and the price targets recommended by the 糖心原创 do not seek to curtail these margins.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The price targets seek to pass through reasonably anticipated productivity improvements and not directly impact upon existing margins.}}}{ As such, the ongoing margins that are implied by the pos sible future price control arrangements would remain until such time as competition became effective. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.3.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Measures to ensure that investment incentives in price-controlled services are not dampened \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The current price control arrangements provide for lower price movements for a service to be deemed where the quality of the service has improved. Conversely, where the quality of service has deteriorated a price increase can be deemed\emdash however in this instance the price deterioration must have occurred so as to circumvent the price control arrangements. Whether a price movement should be deemed to have occurred is left to the 糖心原创. \par In the current price control period, the 糖心原创 has allowed two value claims to a total value of around $25m, in respect of Priority Assistance and 1#, and has more recently refused two value claims\emdash in respect of Telstra Home Messages 101 and Talking Text. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Interested parties were either unaware of the current arrangements or generally did not focus on the issue. \par Optus considered that incentives to maintain the price-controlled services could be dampened by price control arrangements (p.\~6). Telstra similarly considers that (p.\~9): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85 an overly restrictive retail price limit will produce less entry and less investment in network facilities by both incumbents and entrants. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { AAPT noted in its submission that some of the service offerings that Telstra has made as a consequence of claimed quality improvements to the line rental service are anti-competitive (pp.\~9\endash 10). \par The Australian Consumers\rquote Association submitted that Telstra should not be able to receive price control credits for undertaking investments that it must undertake in any event, such as those necessary to meet minimum quality of service levels required by licence conditions (p.\~ 3). \par Many consumers commented on Telstra\rquote s quality of service as an issue of concern to them. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { As a threshold issue, it can be noted that as many of the network elements over which line rental and other price-controll ed services are supplied are essential to the supply of all fixed-line telecommunications services, it is relatively unlikely that Telstra would allow the infrastructure by which the price-controlled services are supplied to deteriorate. That said, the AC CC considers that it can still be in the LTIE for the price control arrangements to provide measures to preserve and enhance the existing incentives to invest. \par While measures to provide such incentives are included in the current price control arrangements, the 糖心原创 would recommend that these provisions be revisited to provide greater clarity as to the nature and purpose of these provisions and to ensure that they provide incentives to maintain service levels as well as to improve them. While other forms of regulation require Telstra to maintain its fixed-line network}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-357\li357\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab As per }{\i Carrier Licence Conditions (Telstra Corporation Limited) Declaration 1997 (Amendment No. 4 of 2002)}{ , which introduced network reliability conditions on Telstra.}}}{ and to provide a specified service quality for connections and fault-handling,}{\cs28\fs18\super \chftn {\footnote \pard\plain \ql \fi-357\li357\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\i\fs20 Telecommunications (Customer Servi ce Guarantee) Standard 2000 (No. 2).}}}{ quality associated with other terms and conditions of supply to customers is not regulated\emdash e.g. eligibility for bundling discounts\emdash and these other schemes would not provide the same incentives for maintaining service quality as an enhanced price control arrangement. \par The 糖心原创 would recommend that, while maintaining its role in determining whether a price movement should be deemed, the future price control arrangements should: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {maintain the current approach to capital investment programs that only extraordinary capital investment should be considered\emdash ongoing operating and maintenance of the existing network and new connections are already built into the price of the line rental service permitted under the price cap \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {remove the current pre-condition before a price increase can be deemed\emdash while a price increase should not be deemed due to, e.g. transient causes reasonably beyond Telstra\rquote s control, the current arrangements would provide little discouragement to even deliberate and sustained measures to reduce service quality \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {make clear that the value of any deemed price movement would be determined by an analysis of the efficient net costs of the investment project\emdash i.e. that the scheme should operate as a pass-through mechanism only for efficiently-incurred costs \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {maintain the 糖心原创\rquote s discretion to be exercised having regard to the LTIE criteria}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Promotion of the LTIE is a guiding objective of the legislation under which the price control arrangements are made}}}{ \emdash e.g. to ensure that claimed costs have been efficiently incurred or that investment programs have not been structured to the detriment of competition \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {encourage Telstra to properly support any claims it makes in a timely manner. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Adopting these measures would encourage efficient investment and better assure service quality. They would also streamline the assessment process and improve the overall efficacy of the price control arrangements. \par Telstra has generally claimed as quality improvements the bundling of product features with the line rental service\emdash an exception to this is the introduction of }{\i Priority Assistance}{ . It can be noted that it would be practicable for Telstra to charge for these product features as discrete services outside the scope of the price control arrangements should it wish to do so\emdash the only basis on which they become relevant to the price control arrangements is where Telstra chooses to bundle them with the line-rental service. \par More recently, Telstra has claimed quality improvements in respect of quality enhancements th at it refuses to supply to other service providers, and which increase its overall profitability by generating additional call revenue. These factors militate against the acceptance of a value claim having regard to the LTIE criteria. \par Telstra does not restrict its claims to a recovery of cost\emdash it seeks to obtain credits to the full amount of the additional revenues that it considers it would be able to generate from the product feature. In addition to the fundamental issue as to whether such an approach cou ld promote the LTIE, this type of analysis is by its nature difficult to undertake in a robust manner. \par In practice, the consideration of Telstra\rquote s claims has also proven problematic due to Telstra being unwilling to supply revenue, cost and demand data rel evant to its claims. This has necessitated much greater research by the 糖心原创 to fully consider claims, with adverse consequences for timeliness. \par As such, to better ensure that claims can be assessed more readily and to provide appropriate incentives for Te lstra in this regard, the 糖心原创 would recommend that the future price control arrangements also require Telstra to supply all data that the 糖心原创 requests to assess the claim. Failure to supply this information by the end of the financial year to which the claim relates should provide grounds to refuse a claim. \par {\*\bkmkstart _Toc87678277}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 5.4\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Duration of price cap arrangements{\*\bkmkend _Toc87678277} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The current price control arrangements are applied for a term of three years. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.4.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Vodafone considered the current period \lquote inadequate\rquote to allo w efficiency improvements, whereas Telstra noted that price control regimes have typically run for three years which was appropriate in the past as it provided a level of certainty for Telstra and the industry (Vodafone, p.\~2; Telstra, p.\~11). \par Submissions and participants at public meetings provided a range of responses in terms of the period of time to which future price control arrangements should apply. The range of responses was between two and five years. \par Telstra argued that the term for next price control arrangements should be two years (p.\~ 11). Telstra made this argument on the basis of uncertainty arising from alternative infrastructure platforms and as a consequence of the uncertainty surrounding future market developments. \par Mr John Clements, for Mr Tony Windsor, MP, noted in the Dubbo public meeting that there was a risk associated with shorter price control periods, as the government could \lquote chip away\rquote at social equity requirements such as the parity provisions. \par The Australian Consumers\rquote Association and ATUG considered that the terms for the next price control arrangements should be three years, with ATUG also suggesting that implementation reviews be conducted every 12 months (ACA, p.\~2; ATUG, p.\~ 5). ATUG noted that the development of strong infrastructure-based competition in local access over this timeframe is highly unlikely given the reaction of the capital markets to telecommunications sector investment at present (pp.\~5-6). \par However, Optus urges caution in applying a retail price control regime over the next three years. Optus believes that in the coming years, a range of new technologies will establish a significant market presence. Optus contended that a poorly-constructed price control regime is likely to stifle and distort entry decisions to the detriment of competition and the long-term interests of consumers (p. 3). \par Optus also suggested that the retail price controls could be linked to developments in competition such that the controls are relaxed as certain competition thresholds are met (p.\~30). \par Finally, Vodafone considers that the term for the next price controls should be five years (p. 2). According to Vodafone, this would provide better incentives for Telstra to achieve efficiencies and productivity improvements, and would also seem con sistent with the approach adopted in other regulated Australian industries such as gas, electricity and water (pp.\~2\endash 3). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.4.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The government has generally adopted a three year period since the price cap was first introduced in 1989. \par In deciding the appropriate duration of the price control arrangements, the 糖心原创 believes there are several issues that should be considered: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {A major objective of this price cap regulation is to provide appropriate incentives to Telstra to seek cost productive efficiency improvements\emdash suggesting that a longer, rather than shorter, price cap period would be preferable. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {A longer price cap period will reduce the regulatory burden and uncertainty associated with a shorter price cap duration. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {A risk associated with longer price cap periods is that market conditions may change such that the price control arrangements are too far removed from the prevailing conditions e.g. impacts of new and emerging technologies, changes to underlying cost conditions, changes in the competitiveness of services. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In light of the above factors and the 糖心原创\rquote s views on new and emerging technologies outlined in section }{\field{\*\fldinst { REF _Ref85454671 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380035003400350034003600370031000000}}}{\fldrslt {8}}}{ , the 糖心原创\rquote s draft view is that no departure from the current price control duration of three years is required. \par {\*\bkmkstart _Toc87678278}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 5.5\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Complementary arrangements{\*\bkmkend _Toc87678278} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 is required to consider whether any other complementary arrangements are required to work in conjunction with the future price controls and, if so, their nature. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.5.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Competing service providers submitted that the 糖心原创 should consider altering the current approach to access regulation. Support was strongest among competing fixed-line service providers for the declaration of a wholesale line rental product (CCC p.\~ 3) or for the price of access to this service be regulated through other means, such as via LCS (AAPT p.\~11, Optus p.\~30). ATUG also recommended regulation of wholesale access prices for line rental. \par Other recommendations were directed towards the indicative prices that have been published for the core services as follows: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {for domestic PSTN OTA, indicative prices should reduce to TSLRIC+\emdash that is, the transition path from price points inclusive of an access deficit contribution to TSLRIC+ should be curtailed (ATUG p.\~6) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {for LCS, indicative prices should reflect TSLRIC+, or if average prices are below cost retail-minus avoidable cost should be applied in respect of each of Telstra\rquote s bundled local call price points (Optus, pp.\~23-4) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {for ULLS, churn costs should be excluded from indicative prices (Optus, p.\~24). \par }\pard\plain \ql \li0\ri0\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The Australian Consumers\rquote Association submitted that Telstra should be required to charge competitors the same as it implicitly charged its own retail operations, and if this was done the price control arrangements could be restricted to pricing wholesale services (p.\~2). \par AAPT submitted that Telstra product bundling should be prohibited or subject to greater regulatory scrutiny (pp.\~9\endash 10). \par It was suggested that carrier licence and spectrum fees should be reduced especially within non-metropolitan areas (ATUG, p.\~ 7). Optus considers that the USO should be abandoned as it impedes investment by competing service provides in non-metropolitan areas (p.\~9). \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {A USO-style industry fund was suggested as an alternative means by which to deliver the low-income package or other initiatives targeting potentially disadvantaged consumers (AAPT, p.\~10; Australian Consumers\rquote Association, p.\~1). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.5.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that the specification of price control arrangements to apply to the basic telecommunication product consisting only of line rental and local calls will provide sufficient certainty to competing service providers as to the prices they would be likely to face for acquiring wholesale line rental services from T elstra. Having said that, the 糖心原创 may still consider in future whether or not to declare a wholesale line rental service. \par At this time, the 糖心原创 does not consider that reconsidering the indicative access prices for core services will materially assist in r ealising the objectives of the proposed price control arrangements. That said, these issues will most likely be considered by other inquiries the 糖心原创 will conduct within the next price control period and further consideration can be given to them at that time. The declaration of the core services will fall for review progressively and the 糖心原创 will be required to consider appropriate pricing principles for continuing declarations. Telstra may in the interim submit access undertakings for assessment. \par The AC CC considers that initiatives to promote efficient investment by competing service providers in non-metropolitan areas are beneficial, and considers that the measures that it has proposed to encourage such investment generally will provide appropriate enc ouragement for such investment. These measures would include scrutiny of bundling practices, and other price elements, in areas where competitive investment in facilities is proceeding. \par The 糖心原创 does not have information available to estimate the impact of reducing carrier charges or spectrum fees to better achieve this, but understands that the Australian Communications Authority has recently reduced licensing charges to benefit smaller carriers}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Australian Communications Authority, }{\i ACA reduces carrier licence charges}{, media release, 28 June 2004.}}}{ and is currently inquiring into spectrum allocation in rural and regional areas.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Australian Communications Authority, }{\i 5.8 GHz band Apparatus Licensing for regional/rural Broadband Wireless Services\emdash Invitation to Comment}{, July 2004.}}}{ Similarly, the 糖心原创 understands that the USO scheme is currently under review and that Optus\rquote concerns have been raised in that inquiry. \par The 糖心原创 considers that the low-income package is an appropriate mechanism by which to deliver tar geted assistance to low-income consumers. In the longer term, further consideration could be given to how the net cost of the low-income package is funded including whether a USO style fund is required. At this time, the 糖心原创 does not consider industry fu nding of the low-income package to be essential given its targeted nature. \par {\*\bkmkstart _Toc87678279}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 5.6\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mechanisms for assessing and enforcing compliance{\*\bkmkend _Toc87678279} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 is directed to consider mechanisms for assessing and enforcing compliance. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.6.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Submissions did not focus on this issue to a material extent. \par ATUG made the point that compliance should be assessed by reference to prices actually paid by consumers (p.\~7). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 5.6.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that better mechanisms should be implemented for assessing and enforcing compliance such that the benefits envisaged by the price control arrangements would be realised. The 糖心原创 recommends that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {proposed line rental prices increases are assessed by the 糖心原创 prior to implementation to better ensure that they will not lead to the price control arrangements being breached \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {allowance and quantification of carry-over credits are made conditional on Telstra\rquote s compliance with the objectives of the price control arrangements and on the provision of timely information necessary to assess compliance \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {more robust information systems are implemented \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {compliance systems discourage the prospect for over-charging, but any over-charging that does occur is to be repaid in the following period. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The first recommendation is made due to Telstra\rquote s existing practices of adopting obviously contentious methods for calculating price movements in the line rental service without consulting the 糖心原创 and increasing prices to exercise the apparent loosening of the price cap that results. \par There have been two such instances that have been identified: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {in reporting the 2001\endash 02 price movement for the line rental service, Telstra substituted for actual demand data values that it considered more consistent with its line rental revenues\emdash resulting in Telstra reporting a price movement that was three percentage points below what would have been reported had actual data been used \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {in reporting the 2002\endash 03 and 2003\endash 04 price movement for the line rental service, Telstra attributed pensioner discounts that are cond itional on the purchase of call services to the line rental service\emdash the amount by which this led to lesser price movements than what would have been reported had these discounts been attributed to call services is not known, but was estimated at around four percentage points. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 considers that this practice should not be permitted to continue and that any future price changes to the line rental service should only be permitted following 糖心原创 assessment of Telstra\rquote s projections. This would require Tels tra providing details of how it intends to treat individual revenue, discount and demand items, the data and assumptions upon which forecasts have been made, and the information systems upon which those data have been obtained. \par The second recommendation is made to better encourage Telstra to comply with the spirit as well as the letter of the price control arrangements by making clear that it will not be able to retain any credits that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {would otherwise accrue as a result of practices that compromise the efficacy of the price control arrangements \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {that could in practice accrue should compliance be assessed on incomplete information. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 has experienced considerable difficulty in obtaining information that is necessary to assess compliance, to the extent t hat Telstra currently refuses even to supply elements of the reports that the 糖心原创 has formally specified pursuant to the existing price control arrangements. \par This regrettably leads to delays in the 糖心原创 reporting on the adequacy of Telstra\rquote s compliance. In the absence of the next price control arrangements providing greater incentives, there is little basis to believe that Telstra\rquote s attitudes will change and that the 糖心原创 will be able to report within more appropriate timeframes. \par Under this approach, carry-over credits would be notified by the Minister after receiving the 糖心原创\rquote s report on the adequacy of Telstra\rquote s compliance. As well as encouraging Telstra to provide complete and timely information, an annual specification of carry-over credit will also provide certainty as to the price cap that is to apply. \par The third recommendation is made because Telstra\rquote s existing information systems have been ill-suited to the price control arrangements and appear to be becoming less suitable. In 2003\endash 04, Telstra recon figured its information systems such that revenue, discount and demand data for local calls could no longer be aligned to metropolitan and non-metropolitan areas, necessitating the second best option of sampling to assess compliance with the geographic pr ice relativities. Practical difficulties experienced in the sampling process further compromise confidence in the results that are obtained. \par The enhancements that are required are that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {revenue and discount accounts and demand measures should be recorded for each product that is an instance of a price controlled service \emdash this will allow for more precise price measures to be calculated that are not influenced by exogenous factors such as churn between products \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {line rental demand measures should be taken from Telstra\rquote s billing systems rather than estimated from service connection and disconnection data.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\super \chftn }{ \tab See Telstra, }{\i Telstra Corporation Limited 03/04 Third Quarter Market Update}{, 21 April 2004, footnote (v) page 10.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {While the scope of price control arrangements, the complexity of Telstra\rquote s tariffs and Telstra \rquote s relatively less aggressive approach to exercising price caps ha ve previously militated against making these improvements, the 糖心原创 now considers that it is both necessary and feasible to make them. Feasibility has been assisted by rationalisation of Telstra\rquote s standard tariffs and the price caps remaining limited to connections, line rentals and call services. \par The fourth recommendation is made because it would be impracticable to compensate individual consumers for any contraventions that may occur other than by crediting their accounts or reducing prices paid on an ong oing basis. While the current price control arrangements contain provisions that go some way towards this, the next price control arrangements should expressly provide a mechanism by which consumers receive redress for a contravention of any of the price- caps. \par {\*\bkmkstart _Toc87678280}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 6\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Impact of current and future price control arrangements{\*\bkmkend _Toc87678280} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { This chapter reviews the impact of the current price control arrangements, and possible future price control arrangements on: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {competition and the future development of competition, having regard in particular to the telecommunications anti-competitive conduct regime and telecommunications access regime under Parts XIB and XIC of the }{\i Trade Practices Act 1974}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the availability, choice, quality and prices of services to consumers and any other impacts on consumers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the telecommunications industry, including on economically efficient investment decisions. \par {\*\bkmkstart _Toc87678281}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 6.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Key elements of current price control arrangements{\*\bkmkend _Toc87678281} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that there are four key elements of the current price control arrangements that t hat have impacted on these matters: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {carry-in of credits into the price control period \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {measures aimed at improving investment incentives \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {pass through of anticipated productivity improvements\emdash the \lquote X\rquote factor \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {measures to protect potentially disadvantaged consumers. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.1.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Carry-in of credits into the price control period \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {By allowing \lquote carry-in credits\rquote , the current price control arrangements inflated the caps for price-controlled services by an amount that was considered equivalent to the amount Telstra had priced beneath the price caps specified in the preceding price control arrangements.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab As the price-capped services did not align, certain adjustments were made in an effort to make the carry-in credit representative of the services that were included in the first basket consisting of calls, but not in the second baske t consisting of line rentals.}}}{ That is, where the aggregated price movements for component services out-performed those required under the price control arrangements, Telstra accumulated \lquote credits\rquote . Telstra was able to \lquote carry-in \rquote the credits into the current price control period. As a result, for example, Telstra carried-in 7.4\~percentage points as a credit for the basket of call services from the previous price control period into 2002\endash 03. \par While it could be argue d that prior-year price restraint should be taken into account, the 糖心原创 considers that price targets should be set on a forward-looking basis and not on the basis of price targets that may have been set too high or too low in previous periods. On a forwa rd-looking basis, the effect of allowing carry-in credits from earlier price control periods is to dilute the pass-through of productivity improvements that are reasonably anticipated for the period. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.1.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Measures aimed at improving investment incentives \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Where t here has been an alteration in the quality of service or in the provision of service, the current price control arrangements allow the 糖心原创 to determine that the price charged for a service should be taken to have increased or decreased as compared to the price actually charged. While the provisions provide some incentives for Telstra to provide price-controlled services to a higher standard, they are of limited utility in encouraging Telstra to maintain quality of service, and provide no direct incentives for other service providers to invest. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.1.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Pass through of anticipated productivity improvements\emdash the \lquote X\rquote factor \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In price caps that take the form of CPI \endash X, the \lquote X\rquote factor determines the real price reductions or increases to average prices that would be requir ed. The X factor is specified having regard to reasonably anticipated productivity improvements such that these are passed on to consumers in the form of lower prices. \par The current price control arrangements specified price caps of CPI + 4 per cent}{\charrsid9840708 }{for all line rentals, of CPI \endash 4.5 per cent for call services and of CPI \endash 0 for connections. The revenue-weighted price cap across both line rental and call services was CPI \endash 1.5 per cent.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab This is calculated by weighting each X by the revenue derived from the services within the respective baskets. For 2002-03, ignoring connections, this gives\line X = 0.65 x 4.5% + 0.35 x -4.0% = 1.5%, leading to an effective cap of CPI \endash 1.5%.}}}{ The 糖心原创 had recommended setting a price cap of around CPI \endash 5 per cent. \par As discussed in }{\field{\*\fldinst { REF _Ref87346604 \\n \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380037003300340036003600300034000000}}}{\fldrslt {Attachment A}}}{, the 糖心原创 estimates that Telstra \rquote s productivity improvements over the period 2000\endash 04 specific to line rentals and calls has been 6.2\~per cent, which means that productivity improvements actually experienced would have been sufficient to sustain a price cap of around CPI \endash 5.45 per cent.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Economy-wide productivity improvement, of around 0.75 per cent, is deducted from the 6.2 per cent productivity improvement for the price-controlled services to give an X of 5.45.}}}{ \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.1.4\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Measures to protect potentially disadvantaged consumers \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The current price control arrangements provide some protection for low-income consumers through a package of targeted services and arrangements. While the fundamental premise of the package is sound and has delivered some benefits for low-income consumers, there are ways to build upon and strengthen these initiatives such that low-income consumers can use basic telecommunications services at a level more proximate to that enjoyed by other Australians. These matters are discussed in Chapter\~}{\field{\*\fldinst { REF _Ref84242550 \\n \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380034003200340032003500350030000000}}}{\fldrslt {9}}}{. \par {\*\bkmkstart _Toc87678282}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 6.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Impact of key elements on baskets of services{\*\bkmkend _Toc87678282} \par {\*\bkmkstart _Toc86054427}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.2.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Line rental{\*\bkmkend _Toc86054427} \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties on the ef fect of the current arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Many interested parties considered that Telstra has finished rebalancing (e.g. AAPT, ATUG). For example, ATUG noted that by the end of the current price control period the need for rebalancing will have been met and arguabl y overtaken by increases in line rental charges (p.\~3). Optus predicted that Telstra will be fully rebalanced by June 2006 at the latest (p. 9). \par In the Sydney public meeting Ms Rosemary Sinclair, ATUG, directly asked Telstra whether it considers that rebal ancing is completed. In response, Mr Bill Scales, Telstra, noted that Telstra was getting close to rebalancing but was not sure whether further line rental increases were feasible given the level of competition that is in the market and that it is competi tion that will determine the extent to which any of the prices adjust. \par Optus submitted that competition for line-rental services has been weak and that pricing line rentals below-cost has contributed to this. Optus noted that competing carriers charge the m arket price for line rental, which in effect is set by Telstra within the line rental sub-cap (p.\~10). \par Many consumers that participated in the public meetings or made submissions raised concerns about the effect of rebalancing. Participants in the Adelaide meeting generally complained that line rental costs too much. Mr Carter considered that rebalancing has been a disaster and has resulted in higher costs for residential consumers for both line rental and local calls (p.\~1). Mr Carter also stated: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {It is sa id Telstra must recover cost of the line infrastructure. What is cost? Replacement cost? What margin is included in that cost? 50%? }{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Submission from Mr J Carter, p.\~2.}}}{\lang1033\langfe3081\langnp1033 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Ms Pergolotti noted in her submission that: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Customers can understand that prices go up from time to time because a compan y needs to stay solvent and the costs of providing goods or services may change over time. But this is not at all the case with Telstra who recently posted a record profit of $4.1 billion. Why should customers get slugged repeatedly with greater charges s imply because Telstra is the greed champion of Australia and considers a profit margin of less than $2 billion to be a failure? \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Additionally, Mr Phil Tsakaros, Pacific Internet, noted in the Melbourne meeting that given the profit margins achieved by Telstra, it appears that it is more than successfully recovering its costs. \par Telstra considers that concern by residential consumers over increasing line rental prices need to be considered against the availability of HomeLine Budget.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab This product offer s lower line rental in return for higher call prices e.g. 30 cent local calls.}}}{ \par The Australian Consumers\rquote Association and CTN noted that this impact has not been uniform over all classes of customers, with low-usage customers relatively worse off under the rebalancing initiatives. \par CTN submitted that a consequence of rapid increases in line rental prices is that some consumers have been forced to give up their fixed-line phone and instead use pre-paid mobile services. CTN considers that, as a result, these consumers pay much more for calls, have worse access to telecommunications services and lose the benefits o f social initiatives, such as access to untimed local calls. \par Optus considered that the current controls on line rental have distorted dynamic efficiencies by requiring that retail prices for line rental be kept on average below cost. This has reduced the sc ope for a reasonable rate of return on investments in competing infrastructure and inhibited the development of competition through facilities-based entry (p.\~ 6). As a result, such investments have only been available where additional revenues are available e.g. from data services. Optus noted that there are other factors that have also inhibited investment levels in the recent past (p.\~21). \par Optus considered that Telstra\rquote s incentives to invest in local loop infrastructure have also been dampened (p.\~10) although Optus noted that Telstra has maintained considerable capital expenditure over the price-control period. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Competition and future development of competition \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {While competition for line rental services has been weak over the period of the price control arrangements, the 糖心原创 considers that the current price control arrangements have promoted the development of competition. \par The consensus arising from the submissions and views expressed at public meetings is that Telstra is now able to recover\emdash or will be close to recovering\emdash all of its efficiently-incurred costs of supplying line rental from line-rental prices by the end of the current price control period. \par Competition is considered more likely due to line-rental prices increasing to ap proximate the cost of supply as this means that competing service providers that are as efficient as Telstra could invest in their own facilities and thereby introduce a greater level of competition. The 糖心原创 notes recent pricing initiatives by Optus to s upply line rentals in its off-net areas and Telstra\rquote s comments noted above that it considers it will be more constrained in future in its own pricing by competing service offerings. \par That said, while ensuring prices can approximate costs is an important pre -condition to the development of greater levels of competition, it would not be sufficient of itself to ensure such competition develops. As previously discussed, additional measures are considered necessary to provide competing service providers with gre ater certainty that market conditions after entry will remain consistent with sustainable and efficient competition. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Availability, choice, quality & prices of services to consumers and any other impacts on consumers \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telstra\rquote s line rental prices increased by 8.4 per\~cent}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The price increase reported in the 糖心原创 report, }{ \i\charrsid13901302 Telstra\rquote s Compliance with the Price Control Arrangements }{\i 2002-03}{ was 7.2\~per\~cent reflecting an allowance made in respect of quality improvements made to the service in that year.}}}{ over 2002-03}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super\charrsid13901302 \chftn }{\charrsid13901302 \tab 糖心原创, }{\i\charrsid13901302 Telstra\rquote s Compliance with the Price Control Arrangements 2002-03}{, }{\charrsid13901302 May 2004}{,}{\charrsid13901302 p.162}{.}}}{ and the 糖心原创 understands that price movements of similar magnitude have been continued in 2003-04. The }{\charrsid7230012 ACC}{C}{\charrsid7230012 \rquote s }{\i\charrsid7230012 Telstra\rquote s Compliance with Price Control Arrangements}{ report does not disaggregate the differing price effects between customer groups. However, as Optus notes, Telstra effectively sets the market retail price for line rental. Therefore, the movements between customer groups across the market would likely reflect Telstra\rquote s line rental price movements. As noted in section\~}{\field{\*\fldinst { REF _Ref85446976 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380035003400340036003900370036000000}}}{\fldrslt {4.2}}}{ , and as expected, residential customers experienced significantly greater price rises compared with business customers. \par The Australian Communications Authority\rquote s }{\i Consumer Satisfaction Survey 2004 }{indicated that the majority of consumers consider that line rental prices are too high. In particular, 67\~per cent of household respondents and 65\~ per cent of small business respondents considered the price they paid for line rental was too high.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Australian Communications Authority, }{\i Consumer Satisfaction Survey 2004\emdash Summary Report}{, Special Report No.\~14, August 2004, p.\~10.}}}{ This may indicate that line rental prices have increased significantly to the extent that they are out of line with community expectations. \par This could perhaps have been avoided by requiring rebalancing for residential consumers over a longer period or by specifying the price control arrangements such that a discrete price target was set for line rentals supplied to residential customers. \par As a guide to the price changes that have been made to residential line rentals, the following table sets out the price increases that have been made to the HomeLine Complete line rental product from 2000 to 2004. \par }\pard\plain \s16\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\bkmkstart _Ref85359912}Table }{\field{\*\fldinst { SEQ Table \\* ARABIC } }{\fldrslt {\lang1024\langfe1024\noproof 1}}}{{\*\bkmkend _Ref85359912} Residential line rental increases\emdash HomeLine Complete \par }\trowd \irow0\irowband0\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\pard\plain \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\b\fs22 Date\cell From\cell To\cell Change\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b \trowd \irow0\irowband0\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\pard \ql \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 1 March 2000\line 1 July 2000\cell }\pard \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 $11.65 (GST excl)\line \cell $13.85 (GST excl)\line $15.24 (GST incl.)\cell 18.9%\line 10%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\pard \ql \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 1 February 2001\cell }\pard \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 $15.24\cell $17.50\cell 14.8%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\pard \ql \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 1 September 2001\cell }\pard \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 $17.50\cell $19.90\cell 13.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow3\irowband3\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\pard \ql \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 1 August 2002\cell }\pard \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 $19.90\cell $21.90\cell 10.1%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\pard \ql \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 1 July 2003\cell }\pard \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 $21.90\cell $23.50\cell 7.3%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow5\irowband5\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\pard \ql \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 1 June 2004\cell }\pard \qc \li0\ri0\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs22 $23.50\cell $26.95\cell 14.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkhdrrows\tbllklastrow\tbllkhdrcols\tbllklastcol \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2397\clshdrawnil \cellx2397\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx4677\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2280\clshdrawnil \cellx6957\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1407\clshdrawnil \cellx8364\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\line Business customers have felt less of the incidence of rising line-rental prices compared to residential consumers. From 1 July 2002 to the present, }{\i HomeLine Complete}{ charges have risen 35.4\~per cent from $19.90 to $26.95. }{\i HomeLine Plus}{ charges have risen 36.8\~ per cent from $21.90 to $29.95. However, from 1 July 2002 to the present, }{\i BusinessLine Complete }{charges have risen 9.4\~per cent $31.95 to $34.95. }{\i BusinessLine Plus}{ charges have risen 10.8\~per cent from $36.95 to $40.95.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The 糖心原创\rquote s discussion paper incorrectly calculated price movements from 1 August 2002 to the present instead of 1 July 2002 to the present. Telstra increased prices on 1 August 2002.}}}{ \par It can be noted that the price of line rental for business customers was much closer to the efficient/underlying cost of the service, compared to the price of line rental for residential customers. In the 糖心原创\rquote s final report for the 2001 review, the 糖心原创 estimated that the annual efficient line costs (2000\endash 01) were $346, on average nationally. At that time, Telstra\rquote s annual charges for line rental were $210 (GST incl.) for residential customers and $330 (GST incl.) for business customers. \par While it is the case that HomeLine Budget will permit some residential consumers to access cheaper line rental, the reach of this product is limited to those customers that do not wish to make many calls. An average residential user would pay higher charges overall on this product and, as such, would not consider that HomeLine Budget in effect offered the prospect of lower line-ren tal charges. \par Having said that, the low-income package has provided some protection for some low-income consumers from the effects of rebalancing and of increasing prices for basic telecommunications service more generally. This is discussed further in section } {\field{\*\fldinst { REF _Ref84242550 \\n \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380034003200340032003500350030000000}}}{\fldrslt {9}}}{. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Telecommunications industry, including the economically efficient investment decisions \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { As the price charged for the line rental service has been below the efficient cost of supply, it is possible that this has discouraged investment by Telstra or other service providers that would have been economically efficient. \par That said, even if the line-rental service was priced proximate to cost, it is unlikely that competing service providers would have sought to duplicate the li ne rental service given its natural monopoly characteristics and the limited appetite of capital markets to telecommunications investments in the recent past. \par In these circumstances, unless compensated from an external source (such as direct government sub sidies or contributions from other operators), the prices of other services will need to be set above cost to ensure that aggregate revenues are sufficient to cover aggregate cost. This can lead to distorted consumption and investment signals across all s ervices, and depending on the magnitude, may distort final consumption and investment decisions. \par The current price control arrangements have addressed this in two ways: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {by permitting rebalancing so that prices approximate cost \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {by allowing the deeming of price reductions to have occurred where quality improvements have been made. \par {\*\bkmkstart _Toc86054428}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.2.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Call services basket{\*\bkmkend _Toc86054428} \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Views of interested parties on the effect of the current arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Optus\rquote submission charted the aggregate price of calls against that required by the curr ent price caps. Optus considers that Telstra does not have unfettered market power in the markets for domestic and international long-distance and fixed-to-mobile calls and that competitive forces have been pushing the prices lower than required by the pr ice control regime. As a result, Optus argued that the first basket of CPI \endash 4.5 per cent price cap on call services is largely redundant (p.\~10). \par }\pard\plain \s16\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\bkmkstart _Ref85357522}Figure }{\field{\*\fldinst { SEQ Figure \\* ARABIC } }{\fldrslt {\lang1024\langfe1024\noproof 3}}}{{\*\bkmkend _Ref85357522} Optus\rquote chart on price movements versus price control pathway}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Optus, }{\i Optus Submission to 糖心原创 on Review of P rice Control Arrangements}{, August 2004, p.\~11.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 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2d010b00040000002701ffff030000001e00040000002d010900040000002d010d00040000002d010e00050000000102ffffff00050000000902000000000700 000016041b07b20b0000ffff08000000fa0200000000000000000000040000002d010c0004000000f0010e00040000002d01060004000000f0010d0005000000 0902ffffff00050000000102000000000400000004010d000400000002010200070000001b040207920b1f001e0007000000fc02000000000000000004000000 2d010d00040000002d01030004000000f0010c00040000002701ffff030000001e0005000000010200000000050000000902ffffff000700000016041b07b20b 0000ffff040000002701ffff030000001e0005000000010200000000050000000902ffffff00040000002701ffff030000001e00050000000102000000000500 00000902ffffff00050000000902ffffff0005000000010200000000040000002d010d00040000002701ffff040000002701ffff04000000f001070004000000 f001080004000000f001090004000000f0010a00040000002701ffff1c000000fb021000070000000000bc02000000000102022253797374656d0000de60e777 e4f51700e4f51700acbc170000f41700685ec730040000002d01070004000000f001040004000000f0010b00040000002701ffff040000002701ffff040000002d010000030000000000}}{ \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {Mr Roger Jos eph, representing Mr Harry Quick, MP, noted in the Hobart meeting that constituents do not consider that lower call charges sufficient to offset increases in line rental have been realised. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telstra reports that the revenue-weighted average price movements for the call services baskets decreased by 1.3\~per cent for 2002\endash 03}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\charrsid13901302 糖心原创, }{\i\charrsid13901302 Telstra\rquote s Compliance with the Price Control Arrangements 2002-03}{\charrsid13901302 , 31 May 2004}{.}}}{ and the 糖心原创 understands that similar overall price movements for this basket have continued.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab In that basket, local calls actually increased by 1.2\~per cent, international long-distance calls decreased by 2.6\~per cent and trunk calls, consisting of domestic long-distance and fixed-to-mobile calls, decreased by 2.4\~per cent.}}}{ \par As CPI has been around 3\~per cent, it can be noted from this that the average price movement for the basket of services has been in line with the annual price reductions that were specified in the current price control arrangements. That is, they represent reductions of around 4.5\~per cent in real terms. \par While the 糖心原创 c onsiders that the price cap on the basket of call services is slack, it does not believe that this is indicative of markets being competitive. The state of competition has been previously discussed. A consequence of the price cap on calls being slack is t h at it is less likely that consumers would experience price reductions that were sufficient to compensate them for rising line rental charges. While the current price-control arrangements are probably sufficient to ensure that an average consumer will pay less in real terms for line rental and local calls,}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { \cs28\fs18\super \chftn }{ \tab On a weighted average basis, the average price for line rental and calls reduced in real terms in 2002-03.}}}{ average price movements can mask divergent prices for different classes of consumers. This matter is discussed in chapter 7. \par In order for this price cap to have had a more direct influence on price moveme nts for calls, and to better ensure that price reductions were more likely to compensate for line rental price increases for a wider class of consumers, the 糖心原创 considers that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the \lquote X\rquote factor should have been more informed by reasonably anticipated produc tivity improvements for the price-controlled services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {carry-in should not have been permitted from the previous price control period. \par {\*\bkmkstart _Toc86054430}{\*\bkmkstart _Toc87678283}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 6.3\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Likely impact of possible future price control arrangements{\*\bkmkend _Toc86054430} {\*\bkmkend _Toc87678283} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {This draft report has suggested the following key initiatives for possible future price control arrangements: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { the inclusion of line rental and price-controlled call services in a broad-based basket with a price target that passes on productivity improvements by way of lower real prices\emdash this requires setting an \lquote X\rquote in formed by reasonably anticipated productivity improvements and not allowing carry-in credits from the current price-control period \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the exclusion of services supplied to at least some business customers from the baskets \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the specification of a price-control arrangement to apply }{\charrsid7748692 to the line rental service or }{to a basic telecommunications product comprising line-rental and local calls \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {pass-through of efficient costs of investment (including a normal commercial return on investment) to improve service quality or the reduction of carry-over credits where quality of service deteriorates \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {measures to provide greater certainty for competing service providers contemplating investment in their own facilities \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {measures to provide greater protection for low-income consumers (considered in chapter }{\field{\*\fldinst { REF _Ref84242550 \\n \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380034003200340032003500350030000000}}}{\fldrslt {9}}}{) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {measures to improve the robustness of the regulatory regime. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.3.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Competition and future development of competition \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that the measures outlined above will promote competition: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {by providin g greater certainty that Telstra would not respond to efficient investment in competing services by pricing to the detriment of sustainable competition\emdash to better ensure that efficient facilities-based competition develops \par {\pntext\pard\plain\s27 \f10\fs28\charrsid7748692 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {\charrsid7748692 should a price cap be applied to a basic telecommunications service comprising line rental and local calls,}{ by allowing competing service providers greater certainty over the maximum prices they would face for local telecommunications services\emdash so as to better ensure that access-based comp etition continues to evolve where competitive infrastructure investment is not feasible \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {not eradicating margins that currently exist on call services\emdash i.e. through setting of price targets }{\charrsid7748692 that are consistent with}{ reasonably forecast productivity improvemen ts. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { That said, the 糖心原创 considers that competition is unlikely to develop in respect of services supplied to low-income consumers and will likely, in the short term, increase to a relatively lesser extent in non-metropolitan areas compared to metropolitan areas. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.3.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Availability, choice, quality and prices of services to consumers and any other impacts on consumers \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In regions or segments where it is feasible for competition to develop, the 糖心原创 considers that the possible future price control arrangements are l ikely to lead to greater availability, choice and quality of services to consumers, and lower prices. This is principally because of measures aimed at promoting competition including facilities-based competition. \par In regions or segments where competition remains unfeasible, the possible future price-control arrangements are likely to encourage Telstra to provide a better quality of service by: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {permitting the pass-through of efficiently-incurred cost of such investments that are undertaken \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {complementing this, introducing the prospect of deemed price increases for measures that cause a deterioration in quality of service to better ensure that existing service quality is maintained. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The specification of a price target informed by Telstra \rquote s reasonably forecast productivity improvements, and the disallowance of carry-in credits from the current price control arrangements, should better ensure that consumers will share in Telstra\rquote s continuing productivity improvements in the form of lower prices. \par The 糖心原创 has not been able to undertake a quantitative an analysis of the economic costs and benefits of the future price control arrangements on different classes of consumers. This is explained further in Chapter }{\field{\*\fldinst { REF _Ref86502004 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380036003500300032003000300034000000}}}{\fldrslt {7}}}{. It is likely that some consum ers will still benefit more, and some less, from initiatives to improve availability, choice, quality and price of services than the average consumer. Additionally, some consumers may still face price increases for the price-capped services. \par That said, the 糖心原创 considers that price movements for the price-capped services will be less divergent for different classes in future, and that additional price control measures directed towards mandating similar costs and benefits across all consumers would come at significant costs to economic efficiency. Other initiatives outside the price control arrangements could be considered to achieve these objectives more directly without efficiency costs. \par While }{\charrsid7748692 the 糖心原创 is still considering the precise form of spe}{cific controls over line rental prices \emdash }{\charrsid7748692 in addition to the inclusion of line rental services within }{ the broad basket of services consisting of line rentals and calls\emdash it is expected that any further increase in line-rental prices would not be detrimental to most consumers. This is because: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { to the extent that this aligns the price of line rental to cost, this will promote more efficient pricing meaning that, on average, consumers will be better off across the range of services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the CPI \endash X cap means that, on average, consumers would face lower prices overall for the price-controlled services even if line-rental prices continue to rise, and a price cap of CPI \endash 5 per cent would ensure that a wider class of consumers distributed around this average would pay less in real terms than is currently the case}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The current price cap across these services is effectively around CPI \endash 1.5 per cent.}}}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { the exclusion of at least some business services should ensure that associated benefits and costs are more-evenly distributed between classes of customers than has been the case in the current price control period\emdash meaning it is relatively less likely that, for instance, residential consumers will, on average, be worse off \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {importantly, the }{\charrsid7748692 price controls specific to the line rental service or }{the basic telecommunications product comprising line rental and local calls }{\charrsid7748692 would lim it any further line rental price increases}{\emdash }{\charrsid7748692 either by directly capping price }{movements}{\charrsid7748692 or by encouraging Telstra or other service providers to offer }{a range of }{\charrsid7748692 line rental and call plans that appeal to a greater number of consumers with different call requirements}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { further to the point outlined directly above, it may mean that if a class of consumers were materially worse-off as a result of continuing increases in the price of Telstra line rentals, there would be a much greater prospect that consumers could c hurn to a competing service provider that offers a more suitable plan \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {finally, low-income consumers would be protected from the effects of any further line-rental increases through the low-income package (as outlined in chapter }{\field{\*\fldinst { REF _Ref84242550 \\n \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380034003200340032003500350030000000}}}{\fldrslt {9}}}{). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 6.3.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telecommunications industry, including the economically efficient investment decisions \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The proposed price-control arrangements seek to encourage economically efficient investment by: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {providing appropriate incentives to Telstra to invest\emdash especially in regions where facilities-based competition remains unfeasible \emdash by allowing for the deeming of price reductions or increases for material quality of service improvements or reductions \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {providing greater certainty that Telstra would not respond to efficient investment in competing services by pricing to the detriment of sustainable competition\emdash better ensuring that facilities-based competition occurs where it is efficient to make such investments. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In segments where facilities-based competition in local access wil l remain unfeasible, the proposed price-control arrangements are likely to promote more robust access-based competition. }{\charrsid7748692 Should the proposed arrangements require the supply of a basic telecommunications product consisting of line rental and local calls at a specified price, this will provide greater certainty to competing service providers over the costs they will face to supply Telstra\rquote s line rental service to their customers.}{ That said, it would remain for parties to negotiate the particular prices that are to apply within the ceiling. \par {\*\bkmkstart _Toc85448365}{\*\bkmkstart _Ref86502004}{\*\bkmkstart _Toc87678284}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 7\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa240\keepn\pagebb\widctlpar \jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Distributional benefits and costs of current and possible future arrangements{\*\bkmkend _Toc85448365} {\*\bkmkend _Ref86502004}{\*\bkmkend _Toc87678284} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 is directed to consider the distribution of the short-term and long-term community and economic benefits and costs, including the impacts on different types of households and business consumers and geographic areas, from both the current price control arrangements and possible future price control arrangements. In particular, the 糖心原创 is directed to consider the consequences of rebalancing of line-rental and call charges. \par It is not possible at present for the 糖心原创 to report in the level of detail that it would consider appropriate, as it does not have necessary data drawn from Telstra\rquote s billing systems that are representative of different cl asses of consumers. Telstra has for some time been attempting to compile this data for the 糖心原创, but has not yet been able to do so. \par While the 糖心原创 intends to include a more detailed analysis in the final report provided that the requisite data can be made available, some observations can be made in this report. \par {\*\bkmkstart _Toc87678285}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 7.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties{\*\bkmkend _Toc87678285} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Telstra submitted that, in considering the distributional effects of price control arrangements, indirect benefits should also be considered. Telstra considers that, alt hough residential consumers may not have benefited from price reductions of a scale experienced by business consumers, they would still have benefited indirectly as businesses would pass through cost savings to their customers (p. 18). \par Hutchison submitted that unless price control arrangements discouraged Telstra from doing so, any reductions in prices for FTM services would be skewed towards corporate customers or customers that take a bundle of services (p. 3). Hutchison considers that future price contr ol arrangements should require price reductions for FTM calls made by each of business and residential customers (p. 4). \par ATUG considers that the corporate segment of the business market has experienced much greater benefits from competition than have other consumers although: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {this greater competition is not necessarily manifest in lower prices, but also in better quality of service or in other ways \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra remains dominant in this market segment \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {concerns remain that price of fixed-line access and fixed-to-mobile calls in this segment remains too high (p. 8 and slides 27-31). \par }\pard \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {ATUG considers that specifying a price control arrangement for a basic telecommunications service\emdash a product that consists solely of line-rental and local calls \emdash would provide greater certainty as to the prices that consumers with basic needs would face (p. 5). \par A recurring point made in submissions or in public meetings was that the inclusion of more competitive segments in broad baskets slackens the price cap that would otherwise apply to less competitive segments.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab An example of this effect is provided by the inclusion of mobile services in previous price control baskets at a time when the price of mobile services declined significantly.}}}{ By implication, such price control arrangements could permit relatively greater deviation in pricing outcomes for those classes of consumers who cannot access more competitive service offerings. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The Australian Consumers\rquote Associa tion submitted that low-use customers have not benefited from rebalancing of line-rental and call prices, and that future price control arrangements should require a greater proportion of price reductions to be directed at such customers (p. 4). \par }\pard\plain \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {CTN submi tted that, in addition to the effects of rebalancing, the levying of incidental fees and charges has also been felt hardest by low-income consumers, while they are unlikely to benefit from volume or bundling discounts (pp. 11-12). CTN also submitted that rural consumers have been left behind and do not share in benefits that increased competition has brought to metropolitan areas (p. 9). \par {\*\bkmkstart _Toc87678286}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 7.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创{\*\bkmkend _Toc87678286} \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 7.2.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Classes to be considered \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that, in assessing distributional effects, the follow ing classes of consumers should be considered\emdash as it is understood each of these may face materially different terms of supply for the price-controlled services: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {corporate and government customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {other business customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {residential customers on reward programs \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {pensioners \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {other residential customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {metropolitan customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {non-metropolitan customers. \par {\*\bkmkstart _Ref86469716}{\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 7.2.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Effect of current price control arrangements and possible future price control arrangements{\*\bkmkend _Ref86469716} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {As noted above, the 糖心原创 does not have sufficient data to make a det ailed assessment of this matter at this time. However, some data are available that allow some observations or tentative conclusions to be drawn in respect of: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the prices that have recently been paid by different classes of consumers for the price-controlled services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the prices these classes would face under the possible future price control arrangements. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Effects of current price control arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The following effects have been considered: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the effect of rebalancing \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the effect of local call relativities. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Rebalancing \par }\pard\plain \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Rebalancing is the initiative to raise the fixed pricing element faced by consumers\emdash i.e. the price of line rental\emdash and lessen the price elements that vary with usage\emdash i.e. call prices. It concerns the relative weight of these price elements\emdash or }{\i structur}{e of pricing \emdash and is distinct from the overall }{\i level}{ of prices that have been charged. \par The effect of rebalancing can be understood by positing who within a class would have benefited if prices for line-rentals and calls would each have moved in line with the movement in overall prices paid, rather than have diverged as they have done. \par It is important to remember in this analysis that the current price control arrangements have permitted rebalancing to occur within certain bounds so as to reduce ine fficiencies caused by substantial disparities between the cost of supplying services and their prices. These disparities had arisen due to past policies that in effect subsidised line rental with funding from inflated call prices and, in particular, from inflated prices for trunk calls. Removing these inefficiencies while remaining revenue neutral will overall increase the welfare of consumers. \par That said, the incidence of any tariff arrangement on particular consumers or a class of consumers depends upon: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the use that is made of the service\emdash other things being equal, the process of rebalancing would benefit those consumers that use more call minutes per service-in-operation, especially those that use relatively more trunk call minutes \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the extent to which the particular prices that they have faced have rebalanced\emdash average price movements for line-rental and call services can mask markedly different prices for constituent classes of consumers. \par }\pard \s27\ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {It could be reasonably expected having regard to the above two factors that business customers would have been more likely to have benefited from rebalancing relative to residential consumers. This is because: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {it is understood that business customers on average would make at least the same calls as residential customers of each service-in-operation \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {line-rental prices for business customers have increased by an amount that is significantly less than the increases experienced by residential customers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {it is understood that call prices for business customers have reduced to the same extent or slightly more than they have for residential customers. \par }\pard \s27\ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 { Within the class of residential consumers, it could be expected that as pensioners and other low-income consumers make much fewer calls than other residential consumers, they would have fared relatively worse than other residential users. However, this is likely to have been ameliorated to some extent by the availability of rebates on line rentals and calls to pensioners (but not to other low-income consumers) or the availability of line rental plans that have not been rebalanced to the same extent as standard plans\emdash but these plans only provide benefit for those pensioner and low-income consumers that wish to make relatively few calls. \par It is less clear whether residential consumers on Telstra\rquote s rewards packages would be better or worse off than other residential consumers. In respect of the rate of rebalancing, rewards customers are required to subscribe for more expensive line-rental products\emdash i.e. those that have increased the most \emdash and may have received a discount of around 5 per cent or 10 per cent on their calls. While rewards packages are structured to grow incremental demand, this demand may be for services other than those subject to price controls. It could not be assumed that demand for calls would be greater for these customers. Nor could it be assumed that rebalancing has been to the relative detriment of those on rewards packages, depending on whether or not demand for calls has been sufficient to compensate for the higher rebalan cing. \par It could be expected that the rate of rebalancing in non-metropolitan areas would be roughly the same as in metropolitan areas: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {as Telstra does not differentiate its standard line-rental prices for non-metropolitan customers\emdash although changing preferen ces for line-rental plans could still mean that the incidence of average price increases may not be uniform across these classes \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {local call price relativities suggest that local call prices would have moved in tandem \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {however, it is less clear whether diff erent price movements for trunk calls have been experienced by non-metropolitan consumers as Telstra has significantly revised its tariff structures for domestic long-distance calls. \par }\pard \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {It is understood that markedly different call profiles exist for metropol itan and non-metropolitan customers, such that on a per service-in-operation basis non-metropolitan consumers use more trunk call minutes. Other things being equal, it would appear from this that non-metropolitan consumers may have fared relatively better from rebalancing than metropolitan consumers. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Local call relativities \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In the absence of the local call relativities, it could be expected that customers in non-metropolitan areas would be charged more for local calls, and that the price charged would appr oach the 22 cent price cap. This is due to the relatively higher costs of supplying local calls in non-metropolitan areas and the lesser degree of competition in those areas. \par Telstra has advised the 糖心原创 of the average price paid for local calls in non-metropolitan areas in 2003-04.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab This has been derived from a sample taken from Telstra\rquote s billing systems.}}}{ Based on this figure, if local call prices would have increased on average to the 22 cent cap in non-metropolitan areas, these customers would on average have paid around }{\cf6\charrsid2849401 [commercial-in-confidence]}{ more exclusive of GST for lo cal calls in the absence of local call relativities. \par It is more difficult to quantify the amount by which local call prices would have reduced in metropolitan areas, although it could be expected that local call prices in these areas would reduce to some e xtent. The extent of any decrease could be expected to depend upon: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {how close to the 22 cent cap average prices became in non-metropolitan areas \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the resulting demand for local calls as a result of price changes \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the disparity between price and cost of supplying local calls in metropolitan areas. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price reductions of }{\cf6\charrsid2849401 [commercial-in-confidence]}{ could be expected in metropolitan areas, on the simplifying assumptions: \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls14\ilvl1\adjustright\rin0\lin360\itap0 {the 22 cent cap is reached in non-metropolitan areas \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}consumption remains unchanged \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}the prices in metropolitan areas decreased so that the reduction in the revenues derived from those calls was equivalent to the additional revenues received due to the higher prices in non-metropolitan areas. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 7.2.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Effects of possible future price control arrangements \par }\pard\plain \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The following effects have been considered: \par {\listtext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls14\ilvl1\adjustright\rin0\lin360\itap0 {the effect of rebalancing \par {\listtext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}the effect of local call relativities. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The effect of rebalancing \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { As noted previously, by the commencement of the next price control period, it is likely that line-rental prices will be suff icient or almost sufficient to fund the cost of supplying line rental services. Further increases in line rental prices will not be necessary in the next price control period in order to better align the price of line rental with the cost of supply. \par That s aid, the possible future price control arrangements would allow Telstra to increase line rental prices further provided that off-setting reductions were made to the price of calls. The rationale for this flexibility is to permit the development of plans f or consumers that have high demand for calls and where more rebalancing would deliver overall benefits. \par Importantly, the possible future price control provisions contain provisions that are directed towards ensuring consumers have the option over accessing plans that are no more rebalanced than those presently offered. This would better ensure that any further rebalancing is not to the detriment of consumers with relatively lesser demand for calls. \par Provided that tailored call plans eventuate in this way: \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls14\ilvl1\adjustright\rin0\lin360\itap0 {c onsumers will be able to select from plans with greater or lesser weight given to the line-rental component that would be suitable to their particular requirements \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}as a consequence, any continuation in rebalancing would be sustainable only where those plans were attractive to classes of consumers. \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {The 糖心原创 considers that the possible future price control arrangements will promote such diversity in call plans because: \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls14\ilvl1\adjustright\rin0\lin360\itap0 { in the more immediate term, a price control arrangement specific to a basic telecommunications service\emdash comprising line rental and local calls only\emdash will better enable competing service providers to differentiate their pricing structures should further rebalancing in Telstra\rquote s prices continue \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}in the longer term, measures to promote sustainable fac ilities-based competition will provide competing service providers with additional flexibility in differentiating their tariff structures. \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {Having said that, as competition is currently weakest in non-metropolitan areas, measures such as these that rely upo n competition may take longer to mature in non-metropolitan areas. \par {\listtext\tab}}\pard\plain \s5\ql \li0\ri0\sa120\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl4\outlinelevel4\adjustright\rin0\lin0\itap0 \i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The effect of local call relativities \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Should local call relativities be continued in the future price control arrangements, the effect of them will depend upon a number of factors such as: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the price movements experienced in average local calls prices in metropolitan areas \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the demand for local calls in non-metropolitan areas. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { This is because average prices in metropolitan areas provide the target price for non-metropolitan calls, and the demand in non-metropolitan areas determines the amount of the revenue foregone in those areas by charging below the 22 cent cap. \par As the local call market is mature, the 糖心原创 would expect that movement in average prices for local calls in metropolitan areas wo uld be relatively modest. However, as demand for local calls in non-metropolitan areas has been relatively low, and domestic long-distance minutes relatively high, there is potential that demand for local calls made in non-metropolitan areas may increase as a result of extended local call zones. \par Having regard to the above factors, it could be anticipated that the effects of continuing the local call relativities would approximate those experienced to date or possibly be of a slightly higher order as those noted in section }{\field{\*\fldinst { REF _Ref86469716 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380036003400360039003700310036000000}}}{\fldrslt {7.2.2}}}{. \par {\*\bkmkstart _Ref85454671}{\*\bkmkstart _Toc87678287}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 8\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar \jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {New and emerging technologies{\*\bkmkend _Ref85454671}{\*\bkmkend _Toc87678287} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In conducting the inquiry, the 糖心原创 is directed to have regard to the implications of new and emerging technologies on price control arrangements and of price control arrangements on new and emerging technologies. \par To assist it in identifying relevant technologies and understanding their implications, the 糖心原创 commissioned a report concerning new and emerging technologies from Pondarosa Communications.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The principal of Pondarosa Communications, Mr Peter Darling, recently chaired the working party on next generation networks that was conducted by the Australian Communications Industry Forum (ACIF).}}}{ \par A copy of the consultant\rquote s report is available on the 糖心原创\rquote s website. \par {\*\bkmkstart _Toc87678288}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 8.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties{\*\bkmkend _Toc87678288} \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 8.1.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {VoIP \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Voice over Internet Protocol (VoIP) or IP Telephony is a technology that can provide an alternative means by which voice communications can be sent and received. \par Telstra considers VoIP is capable of disrupting existing markets structures as it enables calls to be carried either entirely or predominately over the internet, bypassing the PSTN (p.\~9). \par The Australian Consumers\rquote Association considered that VoIP imposes a weak competitive constraint for PSTN services due to high monthly access charges (p.\~ 5). As a result, it submitted that VoIP will not be feasible for a significant class of consumers. CTN also acknowledged this, noting that low-income consumers will take-up new techno logies such as VoIP at a slower rate, given the high up-front costs of adopting the newer technologies (p.\~5). \par In the Perth public meeting, Mr Steve Dalby, Chime Communications, noted that a standard telephone service can be delivered over VoIP. However, C hime noted that there is a noticeable change in the quality of the service, but that it is better than mobile. However, in the Sydney public meeting, Ms Rosemary Sinclair, ATUG, outlined her experiences with VoIP: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Once I had bought my computer and my broad band connection on top of my fixed line, and my headset or handset or adaptor or whatever, then the cost of my half hour to Brussels was nothing. So, the price change is really compelling. On the other side of the ledger, the quality of service issues are really still to be worked through. I wouldn\rquote t be using my VoIP service at the moment for an important phone call that I didn\rquote t want to disappear in the middle. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Indeed, Mr Bill Scales, Telstra, noted in the Sydney meeting \lquote Voice over internet protocol type services\emdash it is clear, at least at this point of the technological development curve\emdash that they are not going to be the same quality of service as we have with PSTN services which has been around for 100 years\rquote . \par Additionally, Mr Mark Needham, National Farmers\rquote Federation, noted in the Canberra meeting that until a common quality of service standard is implemented across VoIP and standard telephone services, one service will not be a substitute for the other. \par In relation to timing, Chime noted in the Perth pu blic meeting that VoIP costs are plummeting and that a small carrier can come in and serve a niche market. According to Chime, this is unlike the past where entrants typically needed to be big and offer a full range of services. Chime considers that it is only a matter of time until we see a considerable number of companies offering VoIP, as companies such as Telstra, Optus and Comindico have based business plans on offering VoIP. \par However, other participants were more circumspect about when the technological change will arrive. Mr Charles Britton, Australian Consumers\rquote Association, stated in the Sydney public meeting \lquote how long til we get there?\emdash We don\rquote t know, but it is going to be a lot longer than we think\rquote . Telstra noted that the industry is in transition and the exact nature of the changes are less predictable (p. 10). \par Mr Britton also noted that \lquote the potential for new technologies don\rquote t always deliver. So there you come back to the point that we are really dealing with tomorrow and tomorrow won\rquote t be a great deal different to today in actuality \rquote . \par Ms Teresa Corbin, CTN, indicated in the Sydney meeting that she does not think that things are going to change that dramatically in the next two to three years and that use of VoIP would be limited to certain classes of consumers. Ms Corbin stated that \lquote I think you are going to find that there will be pockets of technologically advanced groups of consumers that use VoIP and there will be pockets of locations that are already in some respects using VoIP-type services and some of them have been regional areas.\rquote \par Optus considers that the emergence of internet protocol services such as VoIP will enhance competitive intensity in markets for long distance, international and fixed-to-mobile services. (p.\~13). In support of this view, Optus also quoted from an Ernst & Young study that concluded that PC based IP telephony would impact adversely on fixed line telephony: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Revenues derived from fixed wire services will contract at an average rate of roughly one per cent per annum over the period 1999 to 2005. In comparison, global revenues from data services are forecast to expand at an average rate of 18 per cent per annum over the same time frame. Substitution trends favouring mobile or wireless telephony, and technological inno vations in other telecommunications industries which impinge on the activities of this industry such as PC based IP telephony (\lquote e-calling\rquote ) will also have adverse implications for the wired telecommunications industry.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab Optus submission, p.\~ 17 citing a recent Ernst & Young study as reported in IBISWorld, }{\i\charrsid13577560 J71121\emdash Wired telecommunications carriers in Australia}{.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {CTN considers that low-income consume rs will be less likely to have access to VoIP services than other consumers and that steps should be taken to protect low-income consumers from higher prices for the voice telephony services that they will be able to access (p.\~6). \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 8.1.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Other technologies \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Anoth er key technology that Telstra considers will disrupt existing markets structures, and the regulatory regime is the widespread roll out of 3G mobile networks. According to Telstra, this will for the first time make wireless an effective substitute for fix ed voice and data (p.\~10). \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { Telstra noted that new wireless technology, such as Wi-Max, is being developed that will allow greater access to internet services than current access lines and may provide broadband and voice access to all parts of Australia (p.\~7). \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 { In terms of broadband technology, Mr Phil Tsakaros, Pacific Internet, noted in the Melbourne meeting that Telstra is putting in sub-standard or outdated broadband capabilities. As an example, it was noted that in Japan and South Korea, eight or ten Meg abits per second broadband services are the standard, not 1.5 Mbps. Pacific Internet considered that it is unlikely that Telstra will make any significant upgrades to its infrastructure, and therefore consumers will not enjoy the blend of speeds over the next three years. \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {ATUG considered that capital market constraints make investment in local access networks in the next three years highly unlikely (p.\~6). \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Optus considered that capital markets show signs of growing appetite for new investment in telecommunications facilities and that this would most likely be in DSL infrastructure (p.\~19). \par {\*\bkmkstart _Toc87678289}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 8.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar\jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Consultant report{\*\bkmkend _Toc87678289} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The consultant was asked to advise on recently deployed technologies or those reasonably anticipated of being commercially deployed within the next three years. Various technologies by which to provide access to telephony services were identified including cable TV networks, optical fibre networks, radio-based networks, power-line networks and satellite networks. The consultant also identified IP Telephon y\emdash a technology that provides a new method of supplying telephone calls over these new and emerging networks or more traditional networks\emdash as particularly relevant. \par The report concludes that the extent to which these technologies will be commercially deployed in the next three years will depend upon a range of factors in addition to their technical attributes, including commercial considerations and regulatory decision making. While the use of some of the technologies discussed would be unlikely to be used ot her than to supply niche services, others show greater prospect of commercial use to both reduce costs of existing services and to supply new or competing services. \par The report notes that a key factor in determining the extent to which IP Telephony will be used to supply telephony services in competition with existing telephony services (such as PSTN services) will be the quality of the underlying broadband networks and IP applications. Unless customers can access broadband networks that are of greater qual ity than those that typically have been supplied to date, IP telephony will most likely be unsuitable for many customers as their primary means of accessing telephony services. \par {\*\bkmkstart _Ref86558107}{\*\bkmkstart _Toc87678290}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 8.3\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Draft views of the 糖心原创{\*\bkmkend _Ref86558107}{\*\bkmkend _Toc87678290} \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 8.3.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Relevant technologies \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 considers that only techn ologies that have been commercially trialled or deployed in Australia should be considered. Lead times suggest that only technologies that have been trialled are reasonably likely to be subject to widespread commercial use within the next price-control pe riod. \par The 糖心原创 considers as relevant any such technology that would: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { lower the average costs of supply of price-controlled services or otherwise lead to productivity improvements in connection with the supply of those services, and/or \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {allow new services to be supplied in competition with the price-controlled services. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { As the customer access network is the main bottleneck encountered by competing service providers in supplying services in competition with the price-controlled services, technologies that permi t alternative means of access are considered of particular relevance to the supply of competitive services. \par In addition to new and emerging access technologies, IP Telephony is also considered of particular relevance to this inquiry due to its potential to bring material productivity improvements to price-controlled services and to disrupt existing markets. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 8.3.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Implications of new and emerging technologies on price control arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {New and emerging technology can have two implications on future price control arrangements: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {should it lead to productivity improvements, it will influence the price targets that should be specified for price-controlled services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {should it reduce barriers to entry or otherwise facilitate competition, it will influence the scope of services that should be price-controlled. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { On the first point, Telstra has recently unveiled its future network evolution and product strategy}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec } \aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra Corporation Limited, }{\i Telstra unveils Future Network Evolution and Product Strategy}{ , media release, 22 July 2004.}}}{ which includes: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85 an accelerated migration to packet switched network including the rollout of the most advanced IP MPLS core network as a central platform to carry voice and data traffic and support high performance business services\'85 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In respect of possible productivity improvements, Telstra reports that: \par }\pard\plain \s43\ql \li397\ri397\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85 it expects the volume of voice traffic within its core network carried via packet technologies including IP to increase gradually over the next three to five years as additional network capacity was added and as a means of lowering operating costs. \par \'85a rationalisation of Telstra\rquote s networks and platforms was expected to produce expense savings of $110 million over the next two years. \par \'85.TTIP [the Telstra business unit responsible for the initiatives] has achieved a very solid cost outcome for the 2004 financial year with encouraging levels of productivity and performance in the context of this new fiscal year.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab ibid.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { British Telecom has forecast more significant operating cost reductions from similar initiatives that it announced in 2003.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab BT, }{\i 21century_network.ppt}{, presented 16 June 2003, accessed 13\~October 2004, <}{\charrsid7682820 www.btplc.com/News/Presentations/Generalpresentations/21stcenturyBT.htm}{>.}}}{ \par Other technologies in addition to use of IP telephony within the core network would be e xpected to bring productivity improvements. For instance, the use of more reliable radio-based access networks to service areas of more dispersed consumers (i.e. in rural and remote areas) would be likely to bring productivity improvements in servicing th ose customers. Due to the limited scale of such deployments, any associated productivity improvements would, however, be relatively modest. \par In addition, new and emerging technologies can promote the supply of new services to complement existing price-contro lled services or to compete with them. Competing services would be possible to the extent that technologies lower barriers to entry, for example, by allowing bottlenecks to be bypassed. If this results in markets becoming effectively competitive, then thi s will have implications for the scope of the services that should be price-controlled. \par Although there would seem to be widespread support for the proposition that new and emerging technologies have the potential to allow competing services to be supplied, there is considerable uncertainty surrounding the extent to which this will occur and what progress would be made within the next price-control period. It can be noted that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {demand for internet telephony is growing from a very low base}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Refer presentation by Mr Ted Pretty, Telstra, to analysts, }{\i Future Network Evolution And Product Strategy}{, 22\~July 2004, slide\~41, which indicates the Australian market penetration of Voice over IP for \lquote enterprise\rquote customers at less than 5 per cent, for \lquote SME\rquote s at less that 1 per cent and \lquote consumer\rquote at less than 0.1\~per cent.}}}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {previous forecasts for the uptake of internet telephony have proven overly optimistic.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Optus, }{\i\charrsid12612715 The Optus IP Index 2004}{ , August 2004. The report is the third in a series of annual surveys of Optus business and corporate customers, for which 74 customers were surveyed in May 2004.}}}{ \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Telstra has stated that the competitive effect of IP telephony for its PSTN will be modest over the short term. \par }\pard \ql \li567\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin567\itap0 {\fs20\charrsid5978359 While VOIP has been described as a competitive threat for Telstra, the com pany will respond in a measured way. We believe the maximum net revenue effect on Telstra over the next 18 to 24 months is unlikely to be material in the context of our traditional voice revenues}{\fs20 .}{\cs28\fs20\super\charrsid5978359 \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i\charrsid5978359 Telstra Unveils Future Network Evolution and Product Strategy}{, media release, 22 July 2004.}}}{\fs20\charrsid5978359 \par }\pard \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {Various factors confirm this view, and suggest that compet itive pressures would be more likely to continue to be limited over a longer period especially in mass-markets. \par The factors that have been considered are those relating to: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {quality of internet telephony services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {commercial terms of supply of underlying broadband services. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The supply of IP telephony services of a quality that would be suitable as a customer\rquote s primary voice telephony service requires access to networks and applications that are designed and provisioned for that purpose (\lquote IP telephony broadban d networks\rquote ). It can be noted that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the countries in which IP telephony has attracted material levels of demand in mass markets\emdash South Korea and Japan\emdash are those where high quality broadband networks have been deployed and are supplied at a reasonable price \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the current use of IP telephony in Australia is by corporate and government customers that have access to IP telephony broadband networks. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In announcing its next step in supplying voice over IP to residential customers, Telstra notes that various factors would appear to constrain widespread adoption of its service in the immediate future including: \par }\pard\plain \s27\ql \li567\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin567\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\fs20 \'85}{\fs20\charrsid5978359 voice over broadband requires better than entry level (upstream) bandwi}{\fs20 d}{\fs20\charrsid5978359 th to avoid some limitations of quality \par }{\fs20 \'85}{\fs20\charrsid5978359 some new advanced features will require replacement of existing analogue phones with new IP handsets}{\fs20 .}{\cs28\fs20\super\charrsid5978359 \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{ \i\charrsid5978359 Telstra Announces Next Step }{\i i}{\i\charrsid5978359 n Voice over I}{\i P}{\i\charrsid5978359 }{\i t}{\i\charrsid5978359 o Residential Customers}{, media release, 7 September 2004.}}}{\fs20\charrsid5978359 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In addition, contractual terms on which broadband services are supplied can also discourage the use of IP telephony. Typically, the supply of ADSL is conditional on the ongoing supply of a PSTN voice telephony service to the customer.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, \lquote Telstra BigPond Broadband\emdash Cable and ADSL terms and conditions\rquote , accessed 14 October 2004, ; \lquote DSL Layer 3 Internet Grade\rquote , accessed 14 October 2004, ; \lquote DSL Layer 2 Internet Grade\rquote , accessed 14 October 2004, .}}}{ Similarly, Optus charges more for broadband access when supplying customers that do not acquire PSTN telephony.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec } \aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Optus, \lquote Internet services \emdash OptusNet Broadband\rquote , accessed 14 October 2004, <}{ \charrsid2237583 www.optus.com.au/Vign/ViewMgmt/display/0,2627,1038_35709-3_6758--View_354,00.html}{>.}}}{ \par Unless IP telephony broadband networks become available on terms that encourages demand for IP telephony, any competition that results from IP telephony will remain over incremental expenditures. In respect of services supplied to residential customers, competition would in those circumstances be over the sixtieth dollar of monthly expenditure (i.e. after lin e rental and broadband internet access fees have been paid). Product bundling (e.g. free local calls or call rebates) and IP telephony customer equipment costs and fixed monthly charges may further increase the minimum monthly expenditure. \par The extent to which IP telephony broadband networks will become available on reasonable terms for the provision of quality internet telephony services in the short to medium term is uncertain but ubiquitous or widespread access is considered unlikely as: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {there are weak inc entives for Telstra and other service providers to supply such access networks where this would come at the cost of traditional PSTN revenues\emdash it can be noted that Telstra\rquote s planned offering to mass markets is targeted at second or additional lines}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Telstra, }{\i\charrsid5978359 Telstra Announces Next Step }{\i i}{\i\charrsid5978359 n Voice over I}{\i P}{\i\charrsid5978359 }{\i t}{\i\charrsid5978359 o Residential Customers}{, media release, 7 September 2004.}}}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {residential consumers and a significant proportion of business consumers with broadband access are connected to services that have not been provisioned to a sufficient quality of service\emdash it is reported that around 39 per cent of the proportion of small business with broadband access use plans aimed at the residential market that are not suited to supporting applications such as VoIP}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Pacific Internet, }{\i\charrsid1208332 Latest Research Shows Broadband Delivers Value but Low Tech Dominates}{, media release, 21 July 2004 quoting from Pacific Internet, }{\i\charrsid1208332 The Broadband Barometer}{\i \emdash }{\i\charrsid1208332 A report into Broadband Penetration and Usage among Australia\rquote s Small Business Sector}{, July 2004. }}}{ \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {competitive access networks are currently limited to discrete geographic areas. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {That said, there is likely to be relatively greater potential for IP telephony broadband networks or other competitive access networks to be deployed to service particular market segments or particular geographic areas. The measures that the 糖心原创 has proposed to encourage efficient investment by competing service providers could be expected to make an important contribution to realising this potential in the medium term. \par While these networks may be radio-based, the only such network in respect of which an Internet telephony capability has been signalled is Unwired\rquote s network covering the Sydney basin.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Unwired, }{\i\charrsid1208332 Sydney Wins the Speed Race with Launch of Unwired High Speed Broadband Internet}{, media release, 19 August 2004.}}}{ \par Service providers have signalled more extensive investments in DSL overlay networks (where a competing service provider uses its own exchange equipment to supply services over the ULLS). However, the number of such services currently in operation is modest,}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { \cs28\fs18\super \chftn }{ \tab As reflected in current demand for the associated Unconditioned Local Loop Service.}}}{ and the announced investments are limited to only certain exchange service areas and are being made in stages.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Primus and PowerTel have each announced intentions to make additional investments in a number of exchange service areas.}}}{ \par The class of customers that will benefit from competing service offerings is also uncertain, however emerging voice-over-DSL service offerings appear to target customers that require more than four or eight voice lines and a broadband connection.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The enhanced accounting separation regime the applies to Telstra has recently been extended to require imputation testing of the ULLS to supply PSTN voice and broadband services, and the results of that testing may assist in determining the market segments more likely to benefit from DSL overlay networks.}}}{ \par In respect of the disruption likely to be caused to markets in which the price-controlled services are supplied, the use of IP telephony or other new and emerging technologies in certain market segments would cause greater disruption to traditional PSTN services than in others. \par While there are greater prospects for large corporate and government customers to access IP telephony broadband networks}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Of the very limited number of IP telephony services that are currently being supplied, these are typically supplied to large corporate customers or government. Refer presentation by Mr Ted Pretty, Telstra, to analysts, }{\i Future Network Evolution And Product Strategy}{, 22\~ July 2004, slide\~41.}}}{ or other competitive access networks, the number of customer within that class is relatively small and some of them would not be supplied by means of the price-capped services in any case, e.g. they may also be su pplied by means of ISDN or leased lines. \par As such, this disruption will become more significant if and when consumers that use the price-capped services for their primary telecommunications service can access IP telephony broadband networks i.e. smaller business and residential consumers. \par Based on the above, it is considered that bullish forecasts for competition resulting from new and emerging technologies should continue to be approached with some caution in the short to medium term. While it is reasonable to expect that IP telephony or other competing services will be supplied to a growing number of consumers and that some demand will be churned to these services from the price-controlled services, it is considered more likely that this will relate to inc remental expenditures of a minority of consumers. It is not considered likely that substantial migration from the price-capped services would occur in the next price-control period. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 8.3.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Implications of price control arrangements on new and emerging technologies \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Price control arrangements can have implications for the use of new and emerging technologies in a variety of ways: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {as a threshold issue, they specify the maximum prices that could be charged for price-controlled services and will generally prevent mark et entry by service providers that could not supply at or below that price by means of the technologies available to them (unless margins on other services that can be supplied are sufficient to recoup the loss on the price-controlled service) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {they can promote the use of more efficient technologies by Telstra and other service providers by specifying price targets that are informed by associated productivity improvements \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {they can promote the use of new and emerging technologies to provide competing services by requiring regulatory consideration of Telstra\rquote s pricing decisions to ensure that those prices are not anti-competitive. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { While it is unlikely that the price control arrangements have in the past operated to prevent investment in new and emerging technol ogies by Telstra, the 糖心原创 considers that the next price control arrangements should better ensure that investment in efficient technologies is not distorted and that resulting competition is sustainable. \par The 糖心原创 considers that this will be achieved by price control arrangements that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {ensure that price of the line rental service reasonably approximates the cost of supply \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {ensure that price targets for price controlled services are informed by reasonably anticipated productivity improvements associated with the use of new and emerging technologies that will be used to supply those services \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {importantly, specify principles that prohibit pricing by Telstra that would seek to foreclose competing services before economies of scale can accrue or which otherwise wou ld operate to the detriment of sustainable competition\emdash this is a matter discussed previously. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { While some parties have argued for the setting of more permissive price targets as a means to encourage use of new and emerging technology by competing service providers, as already noted the 糖心原创 would see some difficulty with such an approach. \par {\*\bkmkstart _Ref84242550}{\*\bkmkstart _Toc87678291}{\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 9\tab}}\pard\plain \s1\ql \fi-432\li432\ri0\sa480\keepn\pagebb\widctlpar \jclisttab\tx432\aspalpha\aspnum\faauto\ls4\outlinelevel0\adjustright\rin0\lin432\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Protection of potentially disadvantaged customers{\*\bkmkend _Ref84242550}{\*\bkmkend _Toc87678291} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\lang1033\langfe3081\langnp1033 Price controls }{ are considered a key tool for ensuring that efficiency improvements are passed through to consumers as lower prices for telecommunications services in markets which are not yet fully competitive. However, as noted in }{\charrsid12193290 Chapter 3,}{ price controls can also be used to achieve certain social policy/equity objectives. \par The 糖心原创 is directed to consider the appropriatenes s of the current price control arrangements, and possible future price control arrangements, for the protection of potentially disadvantaged residential and business customers in both metropolitan and rural areas. \par {\*\bkmkstart _Toc84907590}{\*\bkmkstart _Toc87678292}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 9.1\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls10\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Current arrangements{\*\bkmkend _Toc84907590}{\*\bkmkend _Toc87678292} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Certain aspects of th e current price control arrangements could be seen as assisting disadvantaged consumers. Firstly, there is an obligation on Telstra to provide a low-income package. Secondly, there is a cap on the price of local calls and on other calls made in extended z ones. Thirdly, there are restrictions on the disparity between metropolitan local calls prices and non-metropolitan local call prices. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.1.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low-income package \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The current price control arrangements specify that Telstra cannot increase line rentals charged at res idential rates without prior consultation with the 糖心原创. To approve the line rental increase, the 糖心原创 must be satisfied that Telstra has complied with clause\~ 22 of its carrier licence, which states that Telstra must have a low-income package in place and must establish a Low-Income Measures Assessment Committee (LIMAC). LIMAC consists of representatives of welfare organisations and is responsible for reporting on the effectiveness of the package to the Minister each year, approving Telstra\rquote s marketing for the scheme and commenting on any proposed changes. \par Telstra\rquote s low-income package is marketed as the \lquote Access for everyone\rquote program. It contains measures specifically targeted at holders of Pensioner Concession Cards and Low-income Health Care Cards. It also has more generally targeted measures that enable consumers to select products or arrangements that might help them reduce the cost of their telephony services, such as the }{\i HomeLine Budget}{ package which has lower line rental and higher call charges than Telstra\rquote s standard packages. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.1.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price cap on local calls \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Another price control that may, in part, be targeted at disadvantaged consumers is the requirement that untimed local call prices be capped at 22 cents for calls made from a residential or business phone, and 40 cents for calls made from a public phone. These price caps ensure, to some extent, that low-income consumers, particularly those in non-metropolitan areas continue to have access to affordable local call services. This was discussed in section } {\field{\*\fldinst { REF _Ref85696717 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380035003600390036003700310037000000}}}{\fldrslt {5.2.2}}}{ \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.1.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Non\endash metropolitan local call price restrictions \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Finally, rural consumers may be protected by the restriction that the weighted average untimed local call price from residential lines in non-metropolitan Australia in 2002\endash 03, 2003\endash 04 and 2004\endash 05 must not exceed the weighted average untimed local call price from residential lines in metropolitan Australia in the preceding financial year by more than 0.4 per cent. A similar restriction applies to business lines. \par These restrictions keep metropolitan and non-metropolitan call prices at very similar levels, and will protect rural consumers from high local call prices. This was discussed in section }{\field{\*\fldinst { REF _Ref85696777 \\r \\h }{{\*\datafield 08d0c9ea79f9bace118c8200aa004ba90b02000000080000000d0000005f00520065006600380035003600390036003700370037000000}}}{\fldrslt {5.2.1}}}{. \par {\*\bkmkstart _Toc84907591}{\*\bkmkstart _Toc87678293}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 9.2\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Views of interested parties{\*\bkmkend _Toc84907591}{\*\bkmkend _Toc87678293} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {This section summarises the views of interested parties from written submissions and the public meetings. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.2.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for low-income consumers \emdash benefits from the current arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telstra\rquote s submission notes that it recognises its role in achieving social policy objectives. The submission states that \lquote the LIMAC measures\'85 have been successful in addressing the government\rquote s (social policy) concerns (p.\~20) and that \lquote LIMAC members conclude that Telstra has responded genuinely and comprehensively to its licence requirements to provide a program assisting low-income Australians to access telecommunications services\rquote (p.\~20). \par At the Sydney public meeting, Mr Bill Scales, Telstra, stated that \lquote this is a \lquote terrific arrangement and we enjoy working with LIMAC, because they are able to provi de us with lots of insights into the way in which low income customers work and require Telstra products, so we have no intention of changing any of those arrangements at all\rquote . \par Optus stated in its submission that it believed that the low-income scheme is successful in meeting the government\rquote s objective of directing social policy benefits to those who should receive those benefits (p.\~ 30). ATUG agreed, noting in the Sydney public meeting that \lquote we think LIMAC is working well\rquote . \par In comparison, CTN argued in its submission that \lquote pensioner discounts remain tokenistic and don\rquote t take into account that [pensioners] are heavy users of telecommunications services\rquote (p.\~ 6). In the Dubbo meeting, Mr Michael Brennan queried whether the 10\~per cent discount is \lquote fair and equitable\rquote . Ms Kelly Madden, Anglicare, argued in the Hobart meeting that the concessions available are very small. \par In the Adelaide public meeting, it was noted that Centrelink provides a rebate to pensioners for line rental charges. Mr Phillips stated that pensioners receive $19.20 every quarter into the pension as a rebate for line rental charges.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The 糖心原创 notes that this allowance is now $19.80 a quarter.}}}{ However, this is separate from the LIMAC scheme, and there was general support at that meeting for lower line rentals rather than receiving compensation through the pension at a later date. \par The necessity for schemes to improve the access of low-income consumers to basic telecommunications services is underscored in the WA Government submission (p.3). This notes ABS data concerning the disparity in telecommunications expenditure as a proportion of household income that has traditionally existed. \par }\pard\plain \s16\ql \li0\ri0\sb120\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Table }{\field{\*\fldinst { SEQ Table \\* ARABIC }}{\fldrslt {\lang1024\langfe1024\noproof 2} }}{ Australian household expenditure: energy, health and telecommunications \par }\trowd \irow0\irowband0\ts11\trrh255\trleft-15\trkeep\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrnone \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth5354\clshdrawnil \cellx8527\pard\plain \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\fs20 \cell }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Gross Income Quintiles\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow0\irowband0\ts11\trrh255\trleft-15\trkeep\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb \brdrnone \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth5354\clshdrawnil \cellx8527\row }\trowd \irow1\irowband1\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrnone \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\dbch\af35 \cell }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Lowest\cell 2\cell 3\cell 4\cell Highest\cell All households}{\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow1\irowband1\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrnone \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\trowd \irow2\irowband2\ts11\trrh255\trleft-15 \trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Average Budget Share (%)}{\fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20\dbch\af35 \cell \cell \cell \cell \cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow2\irowband2 \ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrtbl \clbrdrb \brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\trowd \irow3\irowband3\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb \clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Domestic fuel and power}{ \fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20 8.05}{\fs20\dbch\af35 \cell }{\fs20 3.83}{\fs20\dbch\af35 \cell }{\fs20 2.49}{\fs20\dbch\af35 \cell }{\fs20 1.78}{\fs20\dbch\af35 \cell }{\fs20 1.16}{\fs20\dbch\af35 \cell }{\fs20 2.03}{\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow3\irowband3\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb \brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Transport}{\fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20 30.17}{\fs20\dbch\af35 \cell }{\fs20 17.46}{\fs20\dbch\af35 \cell }{\fs20 14.78}{\fs20\dbch\af35 \cell }{\fs20 13.87}{\fs20\dbch\af35 \cell }{\fs20 10.46}{\fs20\dbch\af35 \cell }{\fs20 13.40}{\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow4\irowband4\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr \brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb \brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl \brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt \brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Petrol}{\fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20 6.48}{\fs20\dbch\af35 \cell }{\fs20 4.22}{\fs20\dbch\af35 \cell }{\fs20 3.35}{\fs20\dbch\af35 \cell }{\fs20 2.67}{\fs20\dbch\af35 \cell }{\fs20 1.84}{ \fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20 2.68}{\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow5\irowband5\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb \clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Household service and operation}{\fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20 16.90}{\fs20\dbch\af35 \cell }{\fs20 7.75}{\fs20\dbch\af35 \cell }{\fs20 5.41}{\fs20\dbch\af35 \cell }{\fs20 4.31}{\fs20\dbch\af35 \cell }{\fs20 3.04}{ \fs20\dbch\af35 \cell }{\fs20 4.69}{\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow6\irowband6\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20 Telephone and facsimile charges}{\b\fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 { \b\fs20 7.95}{\b\fs20\dbch\af35 \cell }{\b\fs20 3.73}{\b\fs20\dbch\af35 \cell }{\b\fs20 2.67}{\b\fs20\dbch\af35 \cell }{\b\fs20 1.91}{\b\fs20\dbch\af35 \cell }{\b\fs20 1.29}{\b\fs20\dbch\af35 \cell }{\b\fs20 2.14}{\b\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20 \trowd \irow7\irowband7\ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb \clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrtbl \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\pard \ql \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 Medical care and health expenses}{\fs20\dbch\af35 \cell }\pard \qr \li0\ri227\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin227\lin0 {\fs20 10.78}{\fs20\dbch\af35 \cell }{\fs20 5.76}{\fs20\dbch\af35 \cell }{\fs20 4.04}{\fs20\dbch\af35 \cell }{\fs20 3.56}{\fs20\dbch\af35 \cell }{\fs20 2.65}{\fs20\dbch\af35 \cell }{\fs20 3.69}{\fs20\dbch\af35 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow8\irowband8\lastrow \ts11\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trftsWidth1 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth3188\clshdrawnil \cellx3173\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4033\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx4893 \clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx5753\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx6613\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth860\clshdrawnil \cellx7473\clvertalb\clbrdrt\brdrtbl \clbrdrl\brdrtbl \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth1054\clshdrawnil \cellx8527\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\i\fs20 Source}{\fs20 . }{\i\fs20 Household Expenditure Survey}{\fs20 1998-99, ABS catalogue 6535.0. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.2.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for low-income consumers\emdash eligibility \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Some submissions and particip ants at the public meetings expressed the view that the current low-income scheme did not cover a sufficiently wide section of potentially disadvantaged consumers. In particular there was some concern that people on low incomes or who were unemployed did not receive the same benefits as did pensioners. \par Anglicare noted in the Hobart meeting that a concession on bills is given to pensioners, because they are long-term low-income consumers. However, Anglicare noted that health care card holders and consumers r eceiving the Newstart allowance do not receive such concessions although they are eligible for some of the low-income packages. \par Brendan (no surname provided), a participant in the Melbourne public meeting, stated: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Our income is really, really low\'85.it would be really good if [Telstra] could put a concession policy in place on line rental. At least just given the appearance that if the policy is in place, say specifically for Newstart Allowance people\'85 it might help people like myself because if you put say 10 per cent on a $30 line rental that is about 15 litres of milk [sic]\'85 it might actually be really nice, you know, to see 10 per cent, $3 a month cut off\'85 \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Mr Malcolm Fowler noted in his submission \lquote being on a low income health card and in a household of two adults with a weekly expenditure budget of $260, the cost of essential services, such as a telephone, is a concern\'85 .Excluding the silent number fee, the line rental accounts for 70 per cent of my last four quarters\rquote bills\rquote . \par Mr Peter Evans noted in his submission \lquote I would like to bring it to your attention that people on a New-start (single income) unemployment allowance in Australia find it very difficult to own a telephone landline now-days. Why is it that there is no subsidy or support from Telstra in th is regard? I would like to suggest that a subsidy and support is necessary for unemployed people\'85\rquote . \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.2.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for low-income consumers\emdash marketing and consumer awareness \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The public meetings seemed to demonstrate that Telstra\rquote s marketing of its low-income scheme had not generated a significant level of consumer awareness. At most of the meetings, participants were not aware of the low-income packages. \par At the Sydney meeting, Commissioner Willett directly asked Mr Scales from Telstra whether Telstra was comfortable with the level of awareness of its disadvantaged group programs. Mr Scales responded: \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {No, we\rquote re not, and that has been an appropriate\'85 criticism of us. We are trying to address it in a number of ways and we have found it difficult to do so. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Ms Corbin, CTN, stated at that meeting \lquote we support the LIMAC program that Telstra has been implementing, however, we have some concerns that unless you know about to access these benefits, there are many of those consumers that are missing out on the benefits of these schemes\'85\rquote . \par In the Hobart meeting, Ms Kelly Madden of Anglicare noted that 36 per cent of Tasmanians rely on pensions and benefits as the main source of income, indicating that low-income consumers are not a minority in that state. However, Anglicare c onsidered that Telstra was reluctant to advertise its products for disadvantaged consumers to raise awareness for those services. In many public meetings, participants noted that Telstra\rquote s marketing and advertising for other services was much more successf ul. There were also suggestions for a recommendation that Telstra should be obligated to advertise its products for disadvantaged consumers more widely, particularly in light of the fact that it receives revenues from other carriers to fulfil its universa l service obligations. \par For those participants that were aware of LIMAC, some considered the scheme to not have been a success. Mr David Tennant, Care Financial Counselling Service, noted in the Canberra meeting that in his experience the services are not pa rticularly well taken up. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.2.4\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for low-income consumers\emdash the regulatory scheme \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Telstra\rquote s submission appears to signal that Telstra considers it is open to abandon its low-income initiatives (p.\~19): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {If future price control arrangements were to limit Telstra\rquote s flexibility to achieve economically efficient pricing outcomes (e.g. a continued calls \endash line rental price rebalancing), Telstra would be placed in the unfortunate position of having to reassess its ability to continue to fund social policy ini tiatives. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { However Mr Scales stated at the Sydney meeting that Telstra had no intention of abandoning its current low income schemes. \par In the Melbourne public meeting, Mr Matt Healy, Macquarie Corporate Telecommunications, queried the sufficiency of the licence condition requiring only that a marketing plan be in existence\emdash commenting that he was not aware of any organisation that would run a business on the basis of merely having a plan. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.2.5\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for non-metropolitan consumers \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {ATUG submits that the price control arrangements should ensure that regional consumers have access to the same range of services at the same prices and levels of service as urban-based consumers (p.\~13). \par Optus would support measures that allow regional consumers to access similar local calls prices that are available to metropolitan consumers. Optus notes that although this would cause some distortions\emdash in terms of detriment to efficiency and some increase to barriers to entry (p.\~27): \par }\pard\plain \s19\ql \li397\ri397\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin397\lin397\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\'85it is likely that any such distortions normally a ssociated with price controls will have less of an impact in rural areas in the shorter term. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In addition, Optus considers that efficiency losses that would arise from maintaining the current local call price relativities may not as high as has been indicated (pp.\~26\endash 27). \par CTN stated that rural consumers have less choice\emdash sometimes no choice\emdash about their choice of telecommunications service provider and that it is appropriate to maintain price controls for them (p.\~9). \par AAPT\rquote s submission\emdash by stating that the USO regime should be strengthened as a means of delivering social policy objectives\emdash implies support for arrangements that provide more equitable access for non-metropolitan consumers to basic telecommunications services that are necessary for everyday life. However, AAPT is not in favour of achieving such measures through price control arrangements (p.\~10). \par {\*\bkmkstart _Toc84907592}{\*\bkmkstart _Toc87678294}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 9.3\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {糖心原创 assessment of the current arrangements for low-income consumers{\*\bkmkend _Toc87678294} {\*\bkmkend _Toc84907592} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 believes that the following criteria should be used to assess the success o f programs aimed at social policy objectives: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {effective targeting\emdash the provision of assistance to people who are in need and the avoidance of provision for those who are not \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {achievement of horizontal equity, which means that people who have similar income or ability to pay contribute a similar tax or subsidy amount \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {achievement of vertical equity, reflected in the criterion that tax or subsidy contributions differ according to differences in income or ability to pay (i.e. those better-off pay more and those w orse-off pay less) \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {maintenance of appropriate incentives for consumption and investment \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {minimisation of administrative costs, including the costs of raising and distributing funds to achieve social outcomes \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {transparency\emdash the awareness by those who fund the assistance of the purpose and cost of the assistance. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 believes that the current low-income scheme has provided some valuable benefits to disadvantaged consumers. However, there may be some problems with the current scheme when assessed according to the above criteria. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.3.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low-income scheme\emdash benefits from the current arrangements \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { A successful low-income scheme needs to correctly target low-income consumers rather than just low-usage consumers. While usage and income may be related to the extent that low- income consumers may not be able to afford the usage they would like to achieve, the two concepts are not the same. It cannot be assumed that a low-income consumer only needs to make a small number of phone calls. \par The current low-income scheme uses some ap propriate proxy measures to judge whether a consumer should be eligible for the low-income package. In particular, the use of pension cards and Low-income health care cards as criteria for some of the schemes is a good way to target low-income consumers. \par However, the 糖心原创 notes that aspects of the current low-income scheme may be directed more towards low usage consumers than low-income consumers. In particular, the structure of Telstra\rquote s two low-income packages\emdash HomeLine Budget and HomeLine Low-income health care card\emdash may penalise low-income consumers who need to make an average number of phone calls. In 2003-04, Telstra supplied around 75 local calls per month to retail and wholesale customers.}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab This is derived by dividing total local calls supplied (9\~397m) by total basic access services-in-operation (10.37 m)\emdash data sourced from Telstra Corporation Limited, }{\i\charrsid6168783 2004 Annual }{\i R}{\i\charrsid6168783 eport}{, p.\~6.}}}{ The 糖心原创 understands that the average number of monthly local calls for Telstra\rquote s retail residential customers is slightly above this average. The 糖心原创 has produced a comparison of the total bill faced by a consumer on each of Telstra\rquote s four call bundle plans for a varying number of capped calls}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab For this analysis, a capped call is a Telstra domestic long-distance or FTM call where there is a limit on the cost of the call. For all four plans, the cap for a long-distance call and FTM call are the same value.}}}{ each month: \par }\pard\plain \s16\ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Table }{\field{\*\fldinst { SEQ Table \\* ARABIC }}{\fldrslt { \lang1024\langfe1024\noproof 3}}}{ Total bill faced by consumers on HomeLine plans \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth5103\clshdrawnil \cellx8222\pard\plain \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\fs20\charrsid13985703 \cell }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid13985703 HomeLine plan\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow0\irowband0\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth5103\clshdrawnil \cellx8222\row }\trowd \irow1\irowband1\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 \cell }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid13985703 Plus\cell Complete\cell HCC}{\cs28\b\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{\tab HomeLine Low-income health care card.}}}{\b\fs20\charrsid13985703 \cell Budget\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow1\irowband1\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Price of line rental\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{ \fs20\charrsid13985703 29.95\cell }{\fs20 $}{\fs20\charrsid13985703 26.95\cell }{\fs20 $}{\fs20\charrsid13985703 20.50\cell }{\fs20 $}{\fs20\charrsid13985703 18.50\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20 \trowd \irow2\irowband2\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Price of a local call\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{\fs20\charrsid13985703 0.175\cell }{\fs20 $}{\fs20\charrsid13985703 0.20\cell }{\fs20 $}{\fs20\charrsid13985703 .24\cell }{\fs20 $}{\fs20\charrsid13985703 0.3}{\fs20 0}{\fs20\charrsid13985703 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow3\irowband3\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl \brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Price of a capped call\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{ \fs20\charrsid13985703 1.5}{\fs20 0}{\fs20\charrsid13985703 \cell }{\fs20 $}{\fs20\charrsid13985703 2}{\fs20 .00}{\fs20\charrsid13985703 \cell }{\fs20 $}{\fs20\charrsid13985703 2.5}{\fs20 0}{\fs20\charrsid13985703 \cell }{\fs20 $}{\fs20\charrsid13985703 3 }{\fs20 .00}{\fs20\charrsid13985703 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow4\irowband4\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 # local calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 75\cell 75\cell 75\cell 75\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow5\irowband5\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Sub total\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{ \fs20\charrsid13985703 43.075\cell }{\fs20 $}{\fs20\charrsid13985703 41.95\cell }{\fs20 $}{\fs20\charrsid13985703 38.50\cell }{\fs20 $}{\fs20\charrsid13985703 41}{\fs20 .00}{\fs20\charrsid13985703 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow6\irowband6\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid13985703 \cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 \cell \cell \cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow7\irowband7\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Monthly bill with 1 capped call\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{\fs20\charrsid13985703 44.58\cell }{\fs20 $}{\fs20\charrsid13985703 43.95\cell }{\fs20 $}{ \fs20\charrsid13985703 41.00\cell }{\fs20 $}{\fs20\charrsid13985703 44.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow8\irowband8\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl \brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Monthly bill with 2 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20 $}{\fs20\charrsid13985703 46.08\cell }{\fs20 $}{\fs20\charrsid13985703 45.95\cell }{\fs20 $}{\fs20\charrsid13985703 43.50\cell }{\fs20 $}{\fs20\charrsid13985703 47.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow9\irowband9\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid13985703 Monthly bill with 3 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{\fs20\charrsid13985703 47.58\cell }{\fs20 $}{\fs20\charrsid13985703 47.95\cell }{\fs20 $}{\fs20\charrsid13985703 46.00\cell }{\fs20 $}{\fs20\charrsid13985703 50.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow10\irowband10\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Monthly bill with 4 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20 $}{\fs20\charrsid13985703 49.08\cell }{\fs20 $}{\fs20\charrsid13985703 49.95\cell }{\fs20 $}{\fs20\charrsid13985703 48.50\cell }{\fs20 $}{\fs20\charrsid13985703 53.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow11\irowband11\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid13985703 Monthly bill with 5 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{\fs20\charrsid13985703 50.58\cell }{\fs20 $}{\fs20\charrsid13985703 51.95\cell }{\fs20 $}{\fs20\charrsid13985703 51.00\cell }{\fs20 $}{\fs20\charrsid13985703 56.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow12\irowband12\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Monthly bill with 6 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20 $}{\fs20\charrsid13985703 52.08\cell }{\fs20 $}{\fs20\charrsid13985703 53.95\cell }{\fs20 $}{\fs20\charrsid13985703 53.50\cell }{\fs20 $}{\fs20\charrsid13985703 59.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow13\irowband13\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb \clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid13985703 Monthly bill with 7 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 $}{\fs20\charrsid13985703 53.58\cell }{\fs20 $}{\fs20\charrsid13985703 55.95\cell }{\fs20 $}{\fs20\charrsid13985703 56.00\cell }{\fs20 $}{\fs20\charrsid13985703 62.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow14\irowband14\ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid13985703 Monthly bill with 8 capped calls\cell }\pard \qr \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20 $}{\fs20\charrsid13985703 55.08\cell }{\fs20 $}{\fs20\charrsid13985703 57.95\cell }{\fs20 $}{\fs20\charrsid13985703 58.50\cell }{\fs20 $}{\fs20\charrsid13985703 65.00\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20 \trowd \irow15\irowband15\lastrow \ts11\trgaph108\trrh255\trleft-15\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh \brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth3134\clshdrawnil \cellx3119\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1275\clshdrawnil \cellx4394\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx5670\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx6946\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1276\clshdrawnil \cellx8222\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\line It can be seen from the above table that a consumer on the HomeLine Low-income health card plan who makes the average number of local calls and makes 5 or more capped calls would be better off o n HomeLine Plus. A consumer on HomeLine Budget would be better off on HomeLine Plus after making two capped calls. The consumer becomes relatively worse off the more calls they make. If the 糖心原创 had used the average number of local calls for Telstra \rquote s retail residential customers instead of the average for all customers, a smaller number of capped calls would be required before the consumer begins to pay relatively more. \par It can therefore be seen that Telstra\rquote s current low-income packages may penalise low-in come consumers who make the average number of local calls and just a few capped calls. As such these HomeLine packages do not seem to effectively target low-income consumers. Rather they would benefit low-usage consumers. Additionally, these schemes fail to achieve vertical equity as they penalise low-income consumers that they are supposed to assist. }{\charrsid1404188 On these plans, low-income consumers that make the same number of call that other consumers make, on average, would pay more for their monthly phone use.}{ \par The 糖心原创 notes that this can be contrasted with the vulnerable user scheme provided by Eircom, Ireland\rquote s incumbent telecommunications operator. Under that scheme, the user registers for a bundle of line rental and \'805 worth of calls for \'80 23.65. Once the user exceeds the \'805 worth of calls, the next \'806.01 worth of calls is charged at double rates and any further calls are charged at the standard rates. This has the effect that a consumer on Eircom\rquote s vulnerable user scheme will never be any more than \'801 worse off compared to a standard customer. This scheme has the advantage of at least curtailing the potential detriment suffered by vulnerable consumers that have to make more calls than they had expected when selecting their plan. \par More preferable still are the low-income schemes that exist for telecommunications users in the USA and UK, and for energy and water consumers in some Australian states. These provide simple reb ates or discounts that mean that the low-income consumer is never worse off under the scheme when compared to the normal package they would otherwise be on. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.3.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low-income scheme\emdash eligibility \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Pensioners and other low-income consumers are treated differently under Telstra\rquote s low-income scheme. Pensioners on standard plans receive a simple rebate on their monthly bill that is at least $3 and can be as high as $12.25 depending on usage. Pensioners on the HomeLine Budget product receive up to $3.50 off their bill. \par Conversely, other low-income consumers do not get a rebate but can use either of the HomeLine plans that are listed in Telstra\rquote s Access for Everyone package\emdash HomeLine Budget or, if eligible, HomeLine Low-income health care card. As stated above, these schemes may have the effect of penalising users relative to consumers on Telstra\rquote s standard plans. \par Consequently, pensioners seem to receive a relatively better deal compared to other low-income consumers, as there is far less potential for them to be worse off than if they were not on the pensioner concession scheme.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab A pensioner would still be worse off if they subscribed to HomeLine Budget and made an average number of local calls and a few capped calls per month.}}}{ \par The 糖心原创 notes that this can be contrasted to the \lquote Lifeline\rquote scheme that operates in the USA. Under the Lifeline scheme, consumers receive at least $5.25 and up to $10 per month rebate on their phon e bills. Certain states provide matching support of up to $3.50 per month, and people living in indigenous tribal lands can also receive further benefits. The scheme is open to low-income consumers based on their participation in other low-income assistan ce programs such as food stamps or energy assistance programs. \par The 糖心原创 notes that both pensioners and Centrelink health care card holders can receive simple rebates or discounts on their energy bills in some Australian states. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.3.3\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low-income scheme\emdash marketing and consumer awareness \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { There was consistent comment at the public meetings that there was an insufficient level of marketing of Telstra\rquote s low-income scheme and that there was low awareness in the general community. This view is to some extent reinforced by LIMAC\rquote s report on the Access for Everyone package.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { \cs28\fs18\super \chftn }{ \tab LIMAC, }{\i\charrsid10051612 Telstra\rquote s Access for }{\i E}{\i\charrsid10051612 veryone }{\i P}{\i\charrsid10051612 ackage}{\i \emdash }{\i\charrsid10051612 LIMAC report to the Minister for Communication s, Information Technology and the Arts}{, April 2004.}}}{ The LIMAC report shows that the level of awareness of Telstra\rquote s low-income programs generally declined from 2002 to 2003.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab ibid, p. v.}}}{ The 糖心原创 also notes that the LIMAC report shows that, while awareness of the Pensioner Concession Scheme, InContact and Homelink 1800 was typically in the order of 20\endash 45 per cent}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab 60 per cent of pensioners were aware of the Pensioner concession scheme \emdash ibid, p. 29.}}}{, other schemes, notably the two low-income HomeLine schemes, had much lower general awareness. \par The 糖心原创 is concerned that the current level of marketing does not seem to successfully satisfy the criteria of transparency. The 糖心原创 believes that a key difficulty with the efficacy of the current scheme is that it requires a high degree of consumer awareness such that a rational choice can be made in advance \emdash based upon anticipated calling patterns\emdash and for the consumer to then apply to Telstra for the relevant product or concession. Engendering such awareness seems an invidious task bearing in mind the disadvantage that the scheme is intended to target. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.3.4\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low-income scheme\emdash the regulatory scheme \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Under the current regulatory scheme, Telstra can only increase the price of line rentals that it charges at residential rates if it has adequately fulfilled the low-income obligations in its carrier licence. The licence conditi on essentially requires that Telstra: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {resources a Low-income Measures Assessment Committee \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {has a plan for offering products or arrangements for low-income customers (a low-income package\rquote ) that was previously endorsed by low-income advocacy groups and whi ch has been since changed only after consulting LIMAC \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {has a marketing plan for making low-income consumers aware of the low-income package that LIMAC has approved \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {has complied with the low-income package as it exists from to time \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {provides a copy of the low-income package to the Australian Communications Authority. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 assesses whether or not Telstra has complied with these requirements on each occasion that Telstra wishes to increase residential line rental prices. \par The 糖心原创 notes that this arrangement has a number of potential problems: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the scheme does not require that the low-income package that is offered has been approved by an independent body\emdash the only limitation to changes being made is that LIMAC must be consulted \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the scheme does not require that the marketing plan be complied with \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the scheme does not permit LIMAC, the 糖心原创 or the Minister to require improvements to the low-income package or the associated marketing plan \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the scheme requires low-income advocacy groups to assess the suitability of th e low-income package, and requires LIMAC to assess the low-income marketing plan, without regulatory or Ministerial oversight \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {given the submissions and statements made at public meetings that line rental rebalancing has completed or that Telstra considers it unlikely that it will increase its residential line rental prices in the same way it has in the past, linking compliance with the package to increases in line rental prices charged at residential rates may not be sufficient. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In the UK and USA, the low-i ncome schemes are part of the Universal Service Obligation placed on the carriers. Such an approach is arguably more robust than the current Australian approach, as approval of the scheme does not depend on the approval of a small group such as LIMAC. The 糖心原创 notes that AAPT\rquote s submission (p.\~10) argued that such an arrangement should apply in Australia. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.3.5\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Low-income scheme\emdash cost of the scheme \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Finally, the 糖心原创 notes that Telstra\rquote s submission (p.\~ 20) estimates that the value of its annual contribution for its various low-income initiatives was more than $160 million for the 2003\endash 04 financial year. As Telstra has not provided any detailed breakdown of this figure, the 糖心原创 is unable to properly assess its accuracy. \par However, the 糖心原创 notes that the net cost of the scheme to Telstra\emdash in terms of additional costs incurred or revenue foregone\emdash may in fact be relatively modest and may be closer to the associated administrative costs than the face value of any discounts that are provided to low-income consumers. \par For example, the provision of concessions on bills to pensioners would not reduce Telstra\rquote s profits by the face value of those concessions. Reasons that the cost of the low-income package will be closer to associated administrative costs include: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {without these con cessions, many pensioners might be unlikely to be able to afford a phone line at all or to make calls with consequential loss of revenues for line rental and calls made from or to those lines \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {as supplies to pensioners are included in the baskets of service s that are subject to price caps, reduced prices for pensioners permit higher prices to be charged for other users that will provide some cross-subsidisation of any foregone revenue \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {given the financial circumstances of customers that access the Telstra bil l assistance program, it would be doubtful whether the charges that are written off under that program would in any event have been paid in full \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {elements of the scheme are unlikely to have required any additional research and development by Telstra or ongoing network related costs\emdash e.g. HomeLine Budget and HomeLine Low-income health care card are simply alternative billing arrangements, and Messagebox is an instance of the Virtual Messagebank retail product. \par {\*\bkmkstart _Ref87334715}{\*\bkmkstart _Toc87678295}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 9.4\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Assessment of current arrangements for non-metropolitan consumers{\*\bkmkend _Ref87334715} {\*\bkmkend _Toc87678295} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The current price control arrangements include measures that go some way towards addressing potential disadvantage arising from a customer being located outside of a metropolitan area. The principal measure is the requirement that local cal l prices in non-metropolitan areas approximate the equivalent prices in metropolitan areas for business and residential consumers respectively. \par In addition, there are a number of other government initiatives\emdash some of which are reflected in the current price control arrangements, such as extended call zones\emdash that also address this issue. \par It was noted in section 5.2.1 that consumers of telecommunications services can be disadvantaged by distance. More particularly, consumers can be disadvantaged by the lower l evel of competition in non-metropolitan areas, which may lead to higher costs and lower quality of service. Additionally, they may not have access to certain services, such as broadband internet, or have access only to services provisioned to a lower stan dard. \par The effect of geographic price relativity in local calls means that both metropolitan and non-metropolitan consumers face local call prices below the 22 cent call cap (apart from the exceptions for the HomeLine Budget and HomeLine Low-income health ca re card plans). The effect of the extended zones subsidy is that users in these areas are charged at untimed local call rates for all calls that end within the same extended zones or an adjacent extended zone, leading to a greater number of calls being ch arged at untimed local call prices than would otherwise be the case. There is also an entitlement to dial-up internet at local call rates provided BigPond is chosen as the ISP. \par It can be noted that the current geographic price relativity only applies to unt imed local calls and does not mandate that rural consumers must not pay more than metropolitan consumers for their telecommunications services more generally. The 糖心原创 notes that data provided by Telstra indicates that non-metropolitan consumers make less er use of local call services\emdash in terms of number of calls and as a proportion of total expenditure\emdash than do metropolitan consumers, but use significantly more domestic long-distance call minutes. Thus the current parity will not ensure complete equity in calling costs. \par Having said that, to require Telstra to implement geographic parity in pricing for all fixed-line services, or for all price-controlled services, would exacerbate efficiency losses associated with the current initiatives, given the disparity in costs of providing fixed-line services in metropolitan and non-metropolitan areas. \par It can also be noted that non-metropolitan consumers would have the option of selecting other service providers to supply pre-selectable services and that this would be expected to curtail Telstra\rquote s pricing of those services in non-metropolitan areas to some albeit limited extent. \par The 糖心原创 notes that the disadvantage potentially faced by rural customers has partially been ameliorated by various other initiatives\emdash that would appear to have less detriment for economic efficiency\emdash such as: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { the Higher Bandwidth Incentive Scheme (HiBIS) which provides ISPs with incentive payments to establish broadband services in rural and regional areas\emdash which is funded by direct Australian government payments to service providers \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the extended zones scheme which provides for additional calls (including dial-up calls to Bigpond) being charged as untimed local calls\emdash which is funded by government payments to Telstra \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {additional network enhancements and other initiatives in rural and regional areas\emdash in respect of fixed-line services and mobile services\emdash that the Australian Government has committed to fund. \par }\pard \s27\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {The 糖心原创 understands that government funding to a total of around $1 billion has been made availabl e in respect of these initiatives, with a significant proportion of this funding being provided directly or indirectly to Telstra. \par {\*\bkmkstart _Toc84907593}{\*\bkmkstart _Ref86479776}{\*\bkmkstart _Toc87678296}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 9.5\tab}}\pard\plain \s2\ql \fi-576\li576\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx576\aspalpha\aspnum\faauto\ls4\ilvl1\outlinelevel1\adjustright\rin0\lin576\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {糖心原创 draft recommendations for future arrangements{\*\bkmkend _Ref86479776}{\*\bkmkend _Toc87678296} {\*\bkmkend _Toc84907593} \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.5.1\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for low-income consumers \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创\rquote s assessment of Telstra\rquote s low-income scheme noted a number of issues: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the low-income-package as a whole seems to be largely unknown in the general community \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the low-income consumers that are on the package may in fact pay more for their basic telecommunications than other consumers should they make similar numbers of calls \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the low-income package offers lesser benefits to low-income users who are not pensioners e.g. holders of low-income health care cards \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the current regulation that underpins the arrangements may not be the most robust approach. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 believes that the low-income scheme is a good initiative that could deliver genuine benefits to low-income consumers of telecommunications services. However, given the above concerns the 糖心原创 believes that there are changes that could improve the scheme. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Ensure that low-income consumers are no worse off than other users \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 believes that the two HomeLine plans marketed to low-income consumers\emdash HomeLine Budget and HomeLine Low-income health care card\emdash should be amended to make them more beneficial for low-income consumers that acquire them. \par This would require either that the plans are varied or concessions extended so that a low-income consumer that makes the same use as other end-users do on average pay less than if they were on a standard plan. \par The 糖心原创 believes that two measures should be introduced to ensure this: \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ls11\adjustright\rin0\lin360\itap0 {extend the current pensioner rebate system to low-income health care cardholders \par {\listtext\pard\plain\f10 \loch\af10\dbch\af0\hich\f10 \'a7\tab}provide a safety net to low-income consumers such that they will pay less than other users regardless of the HomeLine Package that they acquire. \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {The first measure would provide an amount off all low-income consumers\rquote bills regardless of the reason for their low income. This would be similar to the Lifeline scheme in the USA and concession schemes operating for energy and water in some Australian states. \par The second measure would be similar to the scheme currently in operation in Ireland}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Under that scheme, the user will never pay more than \'801 than they would have under a standard plan.}}}{ except that the scheme would operate from the top down \emdash the discount would provide a ceiling below the amount payable on the most beneficial HomeLine plan for the low-income consumer to have selected for their calling patters within the month. This would provide certainty to low-income consumers that the low-income package will benefit them. It would also permit end-users to be churned to the low-income package without them having to expressly apply for it and would provide a more practical means to overcome the ongoing difficulties in adequately marketing the arrangements. This is discussed further below. \par The ACC C also notes that the existing 22 cent local call cap does not apply if a customer is receiving line rental at lower than the standard rate. As such, Telstra charges 24c and 30c for a local call for customers on the HomeLine Low-income health care card an d HomeLine Budget packages respectively. As part of ensuring that low-income consumers are no worse off compared to other consumers, the 糖心原创 believes that this exception to the local-call cap should no longer apply to low-income consumers. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Automatic regist ration for available rebates \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 noted that the marketing of the low-income scheme came under heavy criticism in public consultations and that Telstra conceded that there were problems with its promotion of the scheme. \par The 糖心原创 believes that these difficulties could be more readily overcome if: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {where feasible, elements of the low-income package were restructured such that customer election was not required\emdash e.g. automatic access to concessions based on Centrelink entitlements \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the marketing effort was directed to the remaining elements of the low-income package that still required customer election. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In practice this would require that when a pensioner or low-income consumer registers for a pension card or low-income health care card, Centrelink would inform Telstra and the appropriate arrangements would then be enabled. \par The 糖心原创 notes that Telstra already has an established relationship with Centrelink to operate the Centrepay scheme\emdash where consumers can have an amount automatically deducted from their C entrelink payments and paid to Telstra to go towards their phone bill. Telstra also has established systems for verifying eligibility for pensioner concessions and HomeLine Low-income health care cards. As such, the 糖心原创 believes that automatic registrati on should not be difficult for Telstra to implement. \par However, automatic registration for low-income consumers would obviously only be appropriate if the 糖心原创\rquote s recommendations above about ensuring low-income consumers were never worse off than ordinary consumers were accepted. \par For other aspects of the low-income program, such as Homelink 1800, Incontact, Multiple number and Messagebox, automatic registration would clearly not be appropriate or possible. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Regulatory arrangements to be strengthened \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 bel ieves that it is more appropriate for the current licence condition to be amended to require Telstra to comply with a low-income package and associated marketing plan that the Minister has specified. \par Ministerial specification would permit interested parties to raise improvements that they considered necessary and provide a mechanism by which the interests of disadvantaged consumers and Telstra\rquote s commercial interests could be considered. \par The 糖心原创 considers that revision to the current regulatory arrangements is essential given: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the shortcomings of the existing low-income package when compared to equivalent schemes \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {Telstra\rquote s submission that indicates a view that it is open to it to withdraw elements of the benefits it has made available to date to low-income consumers. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { LIMAC would continue to have an important role in liaising with Telstra over any improvements to the package that Telstra is considering making and making its annual report to the Minister on the package and its marketing, but would also have the ability to propose improvements to the Minister. The 糖心原创 would also intend to make representations to the Minister in respect of the efficacy of the low-income package and associated marketing plan. \par {\listtext\pard\plain\s3 \b \hich\af0\dbch\af0\loch\f0 9.5.2\tab}}\pard\plain \s3\ql \fi-720\li720\ri0\sb120\sa120\keepn\widctlpar\jclisttab\tx720\aspalpha\aspnum\faauto\ls4\ilvl2\outlinelevel2\adjustright\rin0\lin720\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Arrangements for non-metropolitan consumers \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创\rquote s draft view is that the existing price control arrangements for non-metropolitan consumers should be retained, but that additional arrangements should not be introduced in future price control arrangements. This is because: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {relativities over local call p rices go some way to providing better access rural consumers to the basic telecommunications services that are used in everyday life\emdash albeit with some detriment to economic efficiency \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {while there would be some prospect to deliver these outcomes through comp etition, it is relatively unlikely that competitors would seek to compete on price in the supply of local calls in non-metropolitan areas generally \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {while it would be feasible to deliver this outcome in a way that would have lesser consequences for efficiency\emdash for example, by way of government subsidy\emdash it does not seem practicable to fund this initiative in that way as the size of the subsidy would turn on Telstra\rquote s own pricing decisions in metropolitan areas \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {targeted programs already exist or could be developed to overcome other disparities between access to services in metropolitan and non-metropolitan areas. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The detriment to economic efficiency involved in maintaining the current arrangements is moderated due to: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the relatively fewer local calls made in non-metropolitan areas \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the provision of discrete government subsidies to fund the extended call zone initiatives. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar{\*\pn \pnlvlcont\ilvl0\ls0\pnrnot0\pndec }\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 believes that targeted programs are a more appropriate means by which to provide better access to telecommunications services to non-metropolitan consumers in that: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {in addition to making services more affordable, they can act to make a greater range or better quality of services available \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {they are preferable from an economic efficiency perspective. \par {\*\bkmkstart _Toc501346108}{\*\bkmkstart _Toc506803223}{\*\bkmkstart _Ref87346604}{\*\bkmkstart _Toc87678297}{\listtext\pard\plain\s1 \b\fs36\charrsid7869835 \hich\af0\dbch\af0\loch\f0 Attachment A\tab}}\pard\plain \s1\ql \fi-360\li360\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls15\outlinelevel0\adjustright\rin0\lin360\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid7869835 Telstra\rquote s TFP }{m}{ \charrsid7869835 easures }{\charrsid7869835 and the}{\charrsid7869835 }{a}{\charrsid7869835 ppropriate }{l}{\charrsid7869835 evel of }{\lquote }{\charrsid7869835 X}{{\*\bkmkend _Toc501346108}{\*\bkmkend _Toc506803223}\rquote }{\charrsid7869835 {\*\bkmkend _Ref87346604}{\*\bkmkend _Toc87678297} \par }\pard\plain \s2\ql \li0\ri0\sb240\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel1\adjustright\rin0\lin0\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {{\*\bkmkstart _Toc444600330}{\*\bkmkstart _Toc501346112} {\*\bkmkstart _Toc506803225}{\*\bkmkstart _Toc86729695}{\*\bkmkstart _Toc87678298}A.1\tab Principles for determining the value of X{\*\bkmkend _Toc444600330}{\*\bkmkend _Toc501346112}{\*\bkmkend _Toc506803225}{\*\bkmkend _Toc86729695} {\*\bkmkend _Toc87678298} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { In determining the value of X for a broad basket, the 糖心原创 believes that the X value should reflect the overall cost reductions that are feasible. Determination of the value of X requires consideration of a range of factors. These include: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {past and potential productivity growth of Telstra \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {past and potential growth of economy-wide productivity \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {forecasts of traffic growth, investment requirements and the required rates of return on investments. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 Carr ier-wide or more specific TFP measures \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The best comprehensive summary of an enterprise's overall performance is provided by total factor productivity (TFP)}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab See Industry Commission, \lquote }{\charrsid7156003 Government (Non-Tax) Charges\rquote }{\i , }{Report No. 422, Vol. 3, }{\i Efficiency Issues and Public Enterprises, }{AGPS, 1989, p. 134.}}}{ which is calculated as the ratio of two indexes\emdash the aggregate quantity of outputs to the aggregate quantity of inputs. Consequently, }{\charrsid15597853 the impact of technical progress, economies of scale or of scope and managerial improvements}{ are included in these estimates}{\charrsid15597853 .}{ }{\charrsid15597853 Although there are ways of decomposing the estimated TFP, an aggregate measure }{is considered}{\charrsid15597853 sufficient for }{determining an appropriate value of \lquote X\rquote in the CPI \endash X price cap applicable to a regulated firm.}{ \charrsid15597853 \par }\pard\plain \s53\ql \li0\ri0\sa120\widctlpar\tx1440\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { An important issue in determining the appropriate value of X is whether an aggregate TFP measure for a carrier is relevant to the X factor applicable to a basket or sub-baskets of its products. While it may be argued that the most appropriate level of \lquote X\rquote should be based on the TFP growth rates relevant to the price capped services only, such disaggregated data, particularly the cost data, are rarely available in practice. It is therefore customary to estimate a carrier-wide TFP measures and then attempt to adjust this for the basket of services subject to the price cap. \par Based on Telstra\rquote s actual and projected data, the 糖心原创 has estimated TFP measures for the whole-of-Telstra for the period from 1999-00 to 2006-07 (see section A3). \par }\pard \s53\ql \li0\ri0\sa240\widctlpar\tx1440\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 { Telstra also submits on a half-yearly and yearly basis, volume, revenue and cost data for various services under the Regulatory Accounting Framework (RAF). Although there may be some contentious issues about the way costs are allocated between services, these are the best available data to estimate TFP measures for baskets of services separately from the whole-of-Telstra. \par Based on the RAF data, the 糖心原创 has estimated and presented in section A3 TFP measures for a broad basket consisting of Telstra\rquote s price-capped services\emdash i.e. line rental, local calls, domestic and international long-distance calls, and fixed-to-mobile calls (\lquote the price-capped basket\rquote ). It also estimated TFP for all PSTN-related services (incorporating the ISDN overlay and xDSL services using unconditioned copper loops) based on the RAF data. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 TFP of the incumbent carrier less the economy-wide TFP \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {In determining the appropriate value of X, the Productivity Com mission is of the view that it should be equal to the difference between the productivity of the incumbent carrier and the economy as a whole. The Federal Communications Commission (FCC) in the US also applies an X factor that includes only the excess of telecommunications TFP over the economy-wide average TFP growth.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Access Economics, }{\i Review of Price Control Arrangements on Telstra}{, a report prepared for DCITA, August 1998, p. 56.}}}{ \par The rationale for the TFP minus rule (}{{\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{TFP}{\sub TELSTRA}{ }{{\field{\*\fldinst SYMBOL 45 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{ }{{\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{TFP}{\sub ECONOMY}{) is that, everything else being equal, the TFP growth in the economy as a whole will reduce the CPI by a commensurate amount. Therefore, the requirement of Telstra to reduce its prices in real terms should be based on the extent to which its productivity growth exceeds that of the economy as a whole. \par {\*\bkmkstart _Toc506803232}{\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { \charrsid730655 The price index{\*\bkmkend _Toc506803232} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\tqr\tx360\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Regulators in most countries including Australia, New Zealand a nd the United Kingdom prefer the use of the Consumer Price Index (CPI). The CPI element of the price cap formula may be specified either in terms of expected price inflation in the current period or inflation in the previous period. The latter is certain and easier to apply but may delay the producer\rquote s compensation for rising costs at times of increasing inflation}{\cf1 . The opposite will happen at times of declining inflation. }{ The current price controls applied to Telstra use the historical eight-capital-average CPI recorded in the previous year. The 糖心原创 received no advice on this issue in the submissions and considers it appropriate to continue with the index currently in use. \par }\pard\plain \s2\ql \li0\ri0\sb240\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel1\adjustright\rin0\lin0\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid6712068 {\*\bkmkstart _Toc444600336}{\*\bkmkstart _Toc501346118} {\*\bkmkstart _Toc506803226}{\*\bkmkstart _Toc86729696}{\*\bkmkstart _Toc87678299}A.2\tab Methodology used in calculating TFP measures{\*\bkmkend _Toc86729696}{\*\bkmkend _Toc87678299} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {TFP measures represent the ratio of the aggregate quantity of outputs to the aggregate quantity of inputs. Consequently, }{\charrsid15597853 the impact of technical progress, economies of scale or of scope and managerial improvements}{ are included in these estimates}{\charrsid15597853 .}{ As noted above}{\charrsid15597853 , }{such }{\charrsid15597853 an aggregate measure }{is considered}{\charrsid15597853 sufficient for }{the present }{\charrsid15597853 purpose}{ }{\charrsid13321536 to provide an insight into the appropriate value for \lquote X\rquote in the CPI \endash X price cap. \par }\pard \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b\charrsid12914903 A.2.1\tab The basic data \par }\pard \ql \li0\ri0\sa240\widctlpar\tx709\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {As in the case of the 2001 Price Control Review, the TFP measures were calculated for Telstra as a whole as well as }{\charrsid11075871 for PSTN}{ services. In addition, separate TFP measures have been estimated for the price-capped basket. The PSTN-specific measure includes the retail, internal wholesale and external wholesale services. }{\charrsid3610062 The }{ price-capped basket-specific measure includes }{r}{\charrsid3610062 etail services only.}{ \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 { All data for the whole-of-Telstra TFP growth were sourced from Telstra except for the CPI and the price deflator for communications equipments which were sourced from the Australian Bureau of Statistics (ABS). }{Cost and revenue d ata for the retail and wholesale PSTN services as well as for the price-capped basket TFP measures have been sourced from Telstra\rquote s RAF reports. \par }{The sample period in this study extends from 1999-00 to 2003-04 for the historical TFP measures and from 2003-04 to 2006-07 for the projected TFP measures. The forecast TFP is measured only for the whole-of-Telstra. \par }\pard \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b A.2.2\tab }{\b\charrsid12914903 Output Index \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {The output index is made by aggregating growth rates of all outputs using Fisher\rquote s Ideal Index procedure.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\charrsid10758723 For details of the indexation procedure and the reason for selecting}{ a Fisher index, see E. Diewert, \lquote }{\charrsid10758723 Th}{e Measurement of Productivity: A Survey\rquote , p}{\charrsid10758723 aper presented to Swan Consultants Conference}{, } {\charrsid10758723 Sydney, Feb}{ruary}{\charrsid10758723 1993.}}}{ While the quantity of se rvices are those reported by Telstra, the quantity of other services was calculated as the deflated value of the total revenue minus revenues derived from services explicitly present in the equation. \par Two alternative deflators were used to calculate other quantity from the other revenue. First, the price index that the 糖心原创 has observed in reporting to the Minister on changes in prices paid for telecommunications services in Australia}{ \cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab See for instance 糖心原创, } {\i\charrsid13721514 Changes in the Prices Paid for Telecommunications Services in Australia 2002-03}{, May 2004.}}}{ (\lquote the 糖心原创 observed price index\rquote ) and secondly, the telecommunications c omponent of the CPI, the first being called index A and the second index B. \par The implication of using index A or B on TFP measures is obvious. Index A, being a declining index, will improve the measure for other quantity and therefore TFP, and index B bein g an increasing index, will depress the other quantity and consequently the TFP measures. This can be seen in the tables in section A3. \par For the price-capped-basket-specific TFP measure, neither index A nor index B was necessary as the quantity and revenue of these services were readily available. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 Output index for the PSTN and price-capped-basket-specific TFP \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The output index for the PSTN and the price-capped-basket was calculated from the deflated RAF revenue, while the respective price indexes were derived from Telstra\rquote s historical prices of these services.}{\charrsid8995150 \par }\pard \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b\charrsid12914903 A.2.3\tab Input Index \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 Input index for the whole-of-Telstra TFP measures \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { Cost components have been classified under three broad classifications: labour, capital and other costs. Fisher\rquote s Ideal Index procedure was used for aggregation of these inputs while expenses on each individual input were used as weights. \par Other costs have been calculated as Telstra\rquote s total costs less labour and depreciation costs. The most suitable measure for labour inputs is total ho urs worked which was, however, not available. Consequently, average full-time equivalent of staff numbers was used. The other costs have been deflated by the CPI to estimate the quantity of other costs. \par The value of physical quantity of capital stock was estimated using the perpetual inventory method (PIM) with Telstra\rquote s value of assets in 2000 as the starting point. \par }\pard \ql \li0\ri0\sa240\widctlpar\tx720\tx1260\tx1800\tqr\tx8280\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b \tab P K}{\b\fs16 t}{\b = [\{(1\endash d) PK}{\b\fs16 t\endash 1}{\b \} (1+ }{\b {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{\b P)] +INVT}{\b\fs16 t \endash }{\b\fs22 DISP}{\b\fs16 \tab }{\b (1) \par }{where: \par }\pard \ql \fi-720\li720\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0 {\tab PK}{\fs16 t }{ is the value of assets at current prices in year t; \par }\pard \ql \li720\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0 {\charrsid16328802 d}{ is the declining balance depreciation rate (assuming to be 10.4 per cent based on Telstra\rquote s advice); \par }\pard \ql \fi-720\li720\ri0\sa240\widctlpar\tx720\tx1260\tx1800\tqr\tx8280\aspalpha\aspnum\faauto\adjustright\rin0\lin720\itap0 {\tab }{{\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{ P is the change in the capital price index for the Communications Industry sourced from the ABS ie. [(P}{\fs16 t }{/ P}{\fs16 t\endash 1}{) \endash 1]; \par }\pard \ql \li0\ri0\sa240\widctlpar\tx720\tx1260\tx1800\tqr\tx8280\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\tab INVT}{\fs16 t}{ is investment on assets in year t; and \par \tab DISP = value of asset disposals. \par Telstra provided separate investment data for physical plant and equipment (PPE) and software capital (intangible capital) inputs. Following the Industry Commission (1990) and Bureau of Industry Economics (1995),}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\charrsid10758723 Industry Commission}{,}{ \charrsid10758723 }{\i\charrsid10758723 Measuring the Performance of Selected Government Business }{\i E}{\i\charrsid10758723 nterprises}{\charrsid10758723 , Information Paper, Canberra, 1990; B}{ureau of }{\charrsid10758723 I}{ndustry }{ \charrsid10758723 E}{conomics}{\charrsid10758723 , }{\i\charrsid16007959 International}{\i\charrsid10758723 Performance Indicators: Telecommunications}{, Research }{\charrsid10758723 Report 65, AGPS, Canberra, 1995.}{ }}}{ the annualised user cost of the PPE was estimated by Equation 2, while that of the intangible was estimated by Equation 3. \par An alternative value of capital stock was estimated using an aggregate depreciation rate of 13.14 per cent for the entire capital stock including the PPE and intangible capital.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab This depreciation rate was used by the BIE (1995) for an aggregate stock of capital. }{\charrsid15105620 Consequently Equation 3 was unnecessary to estimate user cost of capital}{.}}}{ Also an alternative user cost of capital was estimated following the so-called FCC approach that defines user cost of capital as the difference between total revenue and variable cost was used as weight for the capital input.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab }{\charrsid10644048 See for example, Meyrick & Associates}{,}{\charrsid10644048 }{\i\charrsid10644048 Australia Post}{\i \emdash }{\i\charrsid10644048 Past and Forecast Productivity Growth}{\charrsid10644048 , a report prepared for the 糖心原创, August 2002.}}}{ Ta ble A.2 presents the sensitivity results. \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b \tab VAUC}{\b\fs16 t = }{\b (r}{\b\fs16 t}{\b + d \endash }{\b {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{\b P}{\b\fs16 t }{\b / P}{ \b\fs16 t\endash 1}{\b ) P}{\b\fs16 t}{\b K}{\b\fs16 t\tab }{\fs16 \tab \tab \tab \tab \tab }{\b (2) \par }{\tab where: \par }\pard \ql \li0\ri0\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\tab \tab VAUC = value of user cost; \par }\pard \ql \li1418\ri0\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1418\itap0 {\b r}{ is the opportunity cost of holding capital represented the 10-year bond rate in year t; \par }\pard \ql \fi-1418\li1418\ri0\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin1418\itap0 {\tab \tab }{\b {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 12}{\fldrslt\f3\fs24}}}{\b P}{\b\fs16 t }{\b / P}{\b\fs16 t\endash 1 }{ is the annual rate of change in the price of capital; \par }\pard \ql \li0\ri0\sa120\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\tab \tab }{\b P}{\b\fs16 t }{is the price of capital; and \par \tab \tab }{\b K}{\b\fs16 t}{ is the physical quantity of capital stock in year t. \par }\pard \ql \li0\ri566\sa240\widctlpar\tx720\tx1260\tx1800\aspalpha\aspnum\faauto\adjustright\rin566\lin0\itap0 {\b \tab UCCs = CRF*K}{\b\f39\sub s}{\b\f39\sub\charrsid616933 \par }{\b \tab CRF = r(1+r)}{\b\f39\super n }{\b\f39 / }{\b (1+r)}{\b\f39\super n }{\b\f39 \endash 1\tab \tab \tab \tab \tab \tab (3)}{\cs28\b\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The CRF is same as an a}{\cf1\charrsid7041306 mortisation of a debt }{ \cf1 which means}{\cf1\charrsid7041306 payment of regular instalments}{\cf1 including interest and principal}{\cf1\charrsid7041306 until the t}{\cf1 otal amount has been discharged.}}}{\b\f39\charrsid14431217 \par }\pard \ql \li0\ri0\sa240\widctlpar\tx720\tx1260\tx1800\tqr\tx8280\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {where: \par \tab UCCs = user cost of software capital; \par }\pard \ql \li0\ri566\sa240\widctlpar\tx720\tx1260\tx1800\aspalpha\aspnum\faauto\adjustright\rin566\lin0\itap0 {\tab }{\charrsid616933 K}{\f39\sub\charrsid616933 s}{\f39\sub }{= stock of software capital \par }\pard \ql \li0\ri0\sa240\widctlpar\tx720\tx1260\tx1800\tqr\tx8280\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b\f39\super \tab }{\f39\charrsid14431217 CRF }{\f39 = capital recovery factor; \par \tab r = rate of interest equated to the 10 years bond rate; and \par \tab n = pay off period assumed to be 5 years. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 Input index for the PSTN and price-capped-basket-specific TFP measures \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {I}{\charrsid8542000 nputs are divided into a number of components}{\emdash }{\charrsid8542000 i.e. or ganisational costs, product and customer}{-}{\charrsid8542000 related costs, depreciation, maintenance, other costs and the }{weighted average }{\charrsid8542000 cost of capital (WACC). }{\charrsid8661029 WACC is calculated on the market value of Telstra \rquote s total capital including debt and equity (WACC* value of asse ts). Consequently, it is considered inappropriate to include both depreciation and WACC in capital cost. The 糖心原创 used WACC along with other costs. However, depreciation cost was used as an alternative to WACC to examine the sensitivity of the results (se e Table }{A.}{\charrsid8661029 5). All but depreciation and WACC have been deflated by the CPI to express them in real terms}{\charrsid8542000 .}{ }{\charrsid8542000 Depreciation was deflated by the capital price index sourced from the ABS and the WACC was deflated by an index constructed from the WACC rate}{s}{\charrsid8542000 used in }{Telstra\rquote s}{\charrsid8542000 RAF reports.}{ \par }\pard\plain \s2\ql \li0\ri0\sb240\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel1\adjustright\rin0\lin0\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid6712068 {\*\bkmkstart _Toc86729697}{\*\bkmkstart _Toc87678300}A.3 \tab Estimates of TFP measures for Telstra{\*\bkmkend _Toc86729697}{\*\bkmkend _Toc87678300} \par }\pard\plain \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\b\charrsid12914903 A.3.1\tab Estimates of whole-of-Telstra TFP growth {\*\bkmkend _Toc501346118}{\*\bkmkend _Toc506803226} \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\charrsid4942679 By way of background, the 糖心原创 has observed that over time Telstra\rquote s annual rate of productivity growth has generally increased.}{ }{ \charrsid4942679 For the period 1979-80 to 1987-88 the average growth rate was around 5 per cent per annum.}{ }{\charrsid4942679 This was followed by an annual rate of almost 8 per cent for the seven years to 1993-94 and around 9.6 per cent thereafter to 1999-00.}{\cs28\fs18\super\charrsid4942679 }{ \par As can be seen from Table A.1, TFP for the whole-of-Telstra grew at the rate of 9.1 per cent per annum for the period from 1999-00 to 2003-04 while for the period from 2003-04 to 2006-07 it is expected to grow at the annual rate of 10.0 per cent. \par These results are based on the historical and projected data supplied by Telstra with the following procedures adopted: \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ls18\adjustright\rin0\lin360\itap0 { Other revenue was deflated by the telecommunications component in the CPI for the period from 2000 to 2004 and with an increase of 2.0 per cent per annum since then. \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}A depreciation rate of 10.4 per cent was assumed}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin360\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab The 糖心原创 understands that Telstra uses this rate in its own TFP calculations.}}}{ for the PPE component of assets and an amortisation rate was calculated with an assumed five years pay-off period for the intangible assets. \par {\listtext\pard\plain\f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}Both PPE and intangible assets were deflated by the aggregate capital price index for c ommunications services sourced from the ABS for the period, 1999-00 to 2003-04. The index was then assumed to grow at an annual rate of 2.0 per cent. \par {\listtext\pard\plain\s27 \f10\fs28\charrsid4942679 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ls18\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid4942679 The ten-year bond rate was used as implicit cost of capital.}{ }{\charrsid4942679 The rate was assumed to increase moderately from 5.7 per cent in 2000 to 6.5 per cent in 2007. \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\page }{\b Table A.1: Telstra\rquote s TFP measures \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Year\cell Output\cell Input\cell TFP\cell }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 TFP\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow2\irowband2 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 1.174\cell 1.048\cell 1.120\cell 12.0%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2001-02\cell 1.066\cell 0.935\cell 1.140\cell 1.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03 \cell 1.129\cell 0.967\cell 1.168\cell 2.4%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 1.244\cell 0.878\cell 1.417\cell 21.3%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2004-05 \cell 1.364\cell 0.860\cell 1.586\cell 12.0%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2005-06\cell 1.533\cell 0.867\cell 1.767\cell 11.4%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd 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\clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2006-07 \cell 1.688\cell 0.894\cell 1.888\cell 6.9%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow8\irowband8\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{ \b\fs20\charrsid4798308 5.61%\cell \endash 3.20%\cell 9.10%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow9\irowband9\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb \brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 2004-07\cell }{ \b\fs20\charrsid4798308 10.71%\cell 0.60%\cell 10.04%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow10\irowband10\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard\plain \s3\ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel2\adjustright\rin0\lin0\itap0 \b\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\fs20\charrsid8719145 {\*\bkmkstart _Toc506803227}* }{\b0\fs20\charrsid8719145 Comp}{ \fs20\charrsid8719145 }{\b0\fs20\charrsid8719145 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b0\fs20\charrsid8719145 means annual compound growth rate}{\fs20\charrsid8719145 \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 Sensitivity Check \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Sensitivit y tests conducted for the study reveal that the TFP estimates were insensitive to variations in the output and/or input prices except in circumstances where price changes significantly alter the relative shares of individual output or input components. \par Mo reover, TFP estimates were found insensitive to whether the stock of capital or the user cost of capital is used as capital input provided an appropriate price index is used as deflator. Similarly, results were invariant to using quantity of services or t he deflated revenue in making the output index. \par As expected, results were sensitive to whether the 糖心原创 observed price index or the telecommunications component of the CPI is used as price deflator for other revenue.}{\cs28\fs18\super \chftn {\footnote \pard\plain \s29\ql \fi-357\li357\ri0\sa60\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin357\itap0 \fs20\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\cs28\fs18\super \chftn }{ \tab Revenue for which corresponding quantity data are not available.}}}{ Column 2 in Table A.2 shows that the us e of the 糖心原创 observed price index, which declined moderately in the historical period of the study and is assumed to increase at an annual rate of 2.0 per cent, would have improved the output index and thus the productivity measures. \par All TFP measures pres ented in Table A.2 are based on the same output index. The table shows that while the results are different for different user cost rates assumed, the magnitude of difference for the projected period is not significant. This may be due to the similarity b etween price movements assumed under different scenarios. It is also important to note that the results from using the FCC approach in measuring user cost of capital are not significantly different from the results obtained from using the BIE approach. \par TFP1 shows TFP measures with the 糖心原创 observed price index as the deflator for other revenue while input index remains as in Table A.1. TFP2 shows the results from using an aggregate depreciation rate of 13.14 per cent on the entire capital value including PP E and intangible assets and TFP3 shows the results using the FCC approach in measuring the user cost of capital. \par }{\b Table A.2A: Sensitivity of Telstra\rquote s TFP measures: TFP1 \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Year\cell Output\cell Input\cell TFP\cell }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 TFP\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 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\cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 1.232\cell 1.048\cell 1.175\cell 17.5%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2001-02\cell 1.129\cell 0.935\cell 1.207\cell 2.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03 \cell 1.201\cell 0.967\cell 1.243\cell 3.0%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 1.318\cell 0.878\cell 1.501\cell 20.8%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2004-05 \cell 1.451\cell 0.860\cell 1.687\cell 12.4%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2005-06\cell 1.638\cell 0.867\cell 1.888\cell 11.9%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow7\irowband7\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2006-07 \cell 1.812\cell 0.894\cell 2.027\cell 7.4%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow8\irowband8\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow9\irowband9 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt \f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{\b\fs20\charrsid4798308 7.15%\cell \endash 3.20%\cell 10.68%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow9\irowband9\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt \f3\fs20}}}{\b\fs20\charrsid4798308 2004-07\cell }{\b\fs20\charrsid4798308 11.19%\cell 0.60%\cell 10.54%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow10\irowband10\lastrow \ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2160\clshdrawnil \cellx2160\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 * Comp }{\fs16\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 8}{\fldrslt \f3\fs16}}}{\fs16\charrsid4798308 means annual compound growth rate \par }\pard \ql \li0\ri0\sb120\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b Table A.2B: Sensitivity of Telstra\rquote s TFP measures: TFP2 \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Year\cell Output\cell Input\cell TFP\cell }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 TFP\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow2\irowband2 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 1.232\cell 1.057\cell 1.165\cell 16.5%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2001-02\cell 1.129\cell 0.951\cell 1.187\cell 1.9%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03 \cell 1.201\cell 0.985\cell 1.220\cell 2.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 1.318\cell 0.901\cell 1.462\cell 19.9%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2004-05 \cell 1.451\cell 0.878\cell 1.652\cell 13.0%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2005-06\cell 1.638\cell 0.879\cell 1.862\cell 12.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow7\irowband7\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2006-07 \cell 1.812\cell 0.901\cell 2.011\cell 8.0%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow8\irowband8\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow9\irowband9 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt \f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{\b\fs20\charrsid4798308 7.15%\cell \endash 2.57%\cell 9.97%\cell 10.3%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow9\irowband9\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt \f3\fs20}}}{\b\fs20\charrsid4798308 2004-07\cell }{\b\fs20\charrsid4798308 11.19%\cell 0.00%\cell 11.21%\cell 11.2%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow10\irowband10\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 * Comp }{\fs16\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 8}{\fldrslt \f3\fs16}}}{\fs16\charrsid4798308 means annual compound growth rate \par }\pard \ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b Table A.2C: Sensitivity of Telstra\rquote s TFP measures: TFP3 \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Year \cell Output\cell Input\cell TFP\cell }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 TFP\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trrh416\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil 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\clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 1.232\cell 1.058\cell 1.165\cell 16.5%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2001-02\cell 1.129\cell 0.968\cell 1.166\cell 0.1%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03\cell 1.201\cell 0.994\cell 1.209\cell 3.6%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 1.318\cell 0.923\cell 1.428\cell 18.1%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2004-05\cell 1.451\cell 0.901\cell 1.610\cell 12.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2005-06\cell 1.638\cell 0.899\cell 1.822\cell 13.2%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow7\irowband7\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2006-07\cell 1.812\cell 0.913\cell 1.985\cell 9.0%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow8\irowband8\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\trowd \irow9\irowband9 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt \f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{\b\fs20\charrsid4798308 7.15%\cell \endash 1.98%\cell 9.32%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow9\irowband9\ts11\trgaph108\trleft0 \trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt \f3\fs20}}}{\b\fs20\charrsid4798308 2004-07\cell }{\b\fs20\charrsid4798308 11.19%\cell \endash 0.36%\cell 11.60%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow10\irowband10\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth7200\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1080\clshdrawnil \cellx3420\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx4680\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx5940\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260 \cellx7200\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 * Comp }{\fs16\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 8}{\fldrslt \f3\fs16}}}{\fs16\charrsid4798308 means annual compound growth rat}{\fs20\charrsid4798308 e \par }\pard \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b\charrsid6316952 A.3.2\tab Estimates of price-capped-basket-specific TFP growth{\*\bkmkend _Toc506803227} \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {{\*\bkmkstart _Toc501346122} The 糖心原创 has estimated the change in TFP specifically for the price-capped basket using the RAF revenue and cost data for the period from 1999-00 to 2003-04. Table A.3 presents the results. It shows that output has declined by an annual average rate of 3.0 per cent while input declined by 8.7 per annum. Overall, TFP has grown at an annual average of 6.2 per cent over the period. \par }\pard \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b A.}{\b\charrsid6316952 3.3\tab Estimates of broad \lquote PSTN\rquote -specific TFP growth \par }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\charrsid4942679 The 糖心原创 has also estimated the TFP for the infrastructure by which the price-capped services are supplied for the period from 1999-00 to 2003-04.}{ } {\charrsid4942679 This infrastructure is used to produce a range of additional services such as}{ leased lines and ISDN and xDSL}{\charrsid4942679 (i.e}{.}{\charrsid4942679 broadband services over copper loops).}{ }{\charrsid4942679 \par TFP measures for the entire fixed-line network (PSTN/ISDN/xDSL) are presented in Table }{A.}{\charrsid4942679 4.}{ }{\charrsid4942679 The table shows that TFP has grown at an annual rate of 5.7 per cent over the period, 1999-00 to 2003-04.}{ \par }{\charrsid8661029 TFP measures presented in Table }{A.}{\charrsid8661029 4 are on the basis of using WACC as capital}{ cost. }{\charrsid8661029 Interest costs are included with other costs and, as a result and could not be separately identified.}{ }{ \charrsid8661029 A sensitivity test was carried out using depreciation as the capital cost. The results are presented in Table }{A.}{\charrsid8661029 5. It shows an annual compound average TFP growth of 6.1 per cent. \par }\pard\plain \s53\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\f40 In the absence of any projected data on service-specific costs, the service specific TFP could not be estimated for the next price control period. The 糖心原创, however, believes that continuation of price-capped-service-specifi c TFP growth of around 6 per cent is a reasonable expectation for the next three years. \par }\pard\plain \ql \li0\ri0\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\b Table A.3: TFP measures for the price-capped basket \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh611\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil 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\clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\trowd \irow2\irowband2 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 0.950\cell 0.994\cell 0.956\cell }{\b\fs20\charrsid4798308 \endash }{\fs20\charrsid4798308 4.4%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2001-02\cell 0.890\cell 0.735\cell 1.210\cell 26.6%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid4798308 2002-03\cell 0.887\cell 0.657\cell 1.351\cell 11.6%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 0.884\cell 0.695\cell 1.272\cell }{\b\fs20\charrsid4798308 \endash }{\fs20\charrsid4798308 5.9%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{ \b\fs20\charrsid4798308 \endash 3.04%}{\b\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }{\b\fs20\charrsid4798308 \endash 8.69%}{\b\fs20\charrsid4798308 \cell }{\b\fs20\charrsid4798308 6.20%}{\b\fs20\charrsid4798308 \cell }{ \b\fs20\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 * Comp }{\fs16\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 8}{\fldrslt\f3\fs16}}}{\fs16\charrsid4798308 means annual compound growth rate \par }\pard \ql \li0\ri0\sb360\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b Table A.4: TFP measures for PSTN/ISDN/xDSL services \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh611\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalc\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\pard \qc \li0\ri0\sb60\sa120\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \b\fs20\charrsid4798308 Year\cell }{\cs54\b\fs20\charrsid4798308 Output}{\fs20\charrsid4798308 \cell }{\cs54\b\fs20\charrsid4798308 Input}{\fs20\charrsid4798308 \cell }{\cs54\b\fs20\charrsid4798308 TFP}{\fs20\charrsid4798308 \cell }{ \b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 TFP}{\fs20\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trrh611\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalc\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb \brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 1.018\cell 0.875\cell 1.164\cell 0.164\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid4798308 2001-02\cell 0.999\cell 0.662\cell 1.510\cell 0.297\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03\cell 1.002\cell 0.797\cell 1.258\cell }{\b\fs20\charrsid4798308 \endash }{\fs20\charrsid4798308 0.167\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 1.001\cell 0.803\cell 1.247\cell }{\b\fs20\charrsid4798308 \endash }{\fs20\charrsid4798308 0.009\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{ \b\fs20\charrsid4798308 0.03%}{\b\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }{\b\fs20\charrsid4798308 \endash 5.34%}{\b\fs20\charrsid4798308 \cell }{\b\fs20\charrsid4798308 5.68%}{\b\fs20\charrsid4798308 \cell }{ \b\fs20\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 * Comp }{\fs16\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 8}{\fldrslt\f3\fs16}}}{\fs16\charrsid4798308 means annual compound growth rate \par }\pard \ql \li0\ri0\sb360\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b Table A.5: TFP measures for PSTN/ISDN/xDSL services (Sensitivity Check) \par }\trowd \irow0\irowband0\ts11\trgaph108\trrh611\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalc\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \b\fs20\charrsid4798308 Year\cell }{\cs54\b\fs20\charrsid4798308 Output}{\fs20\charrsid4798308 \cell }{\cs54\b\fs20\charrsid4798308 Input}{\fs20\charrsid4798308 \cell }{\cs54\b\fs20\charrsid4798308 TFP}{\fs20\charrsid4798308 \cell }{ \b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 TFP}{\fs20\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trrh611\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalc\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalc\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb \brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell 1.000\cell 1.000\cell 1.000\cell }{\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell 1.018\cell 0.823\cell 1.236\cell 23.6%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \fs20\charrsid4798308 2001-02\cell 0.999\cell 0.601\cell 1.662\cell 34.5%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb \brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600 \clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03\cell 1.002\cell 0.780\cell 1.285\cell }{\b\fs20\charrsid4798308 \endash }{\fs20\charrsid4798308 22.7%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow4\irowband4\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2003-04\cell 1.001\cell 0.790\cell 1.268\cell }{\b\fs20\charrsid4798308 \endash }{\fs20\charrsid4798308 1.3%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow5\irowband5\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr\brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv \brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Comp }{\b\fs20\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 10}{\fldrslt\f3\fs20}}}{\b\fs20\charrsid4798308 2000-04\cell }{ \b\fs20\charrsid4798308 0.03%}{\b\fs20\cf1\lang3081\langfe1033\cgrid0\langfenp1033\charrsid4798308 \cell }{\b\fs20\charrsid4798308 \endash 5.72%}{\b\fs20\charrsid4798308 \cell }{\b\fs20\charrsid4798308 6.12%}{\b\fs20\charrsid4798308 \cell }{ \b\fs20\charrsid4798308 \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow6\irowband6\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw10 \trbrdrl\brdrs\brdrw10 \trbrdrb\brdrs\brdrw10 \trbrdrr \brdrs\brdrw10 \trbrdrh\brdrs\brdrw10 \trbrdrv\brdrs\brdrw10 \trftsWidth3\trwWidth8100\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3 \clvertalt\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr \brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth2340\clshdrawnil \cellx2340\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1260\clshdrawnil \cellx3600\clvertalb\clbrdrt \brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx5040\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1440\clshdrawnil \cellx6480\clvertalb\clbrdrt\brdrs\brdrw10 \clbrdrl\brdrs\brdrw10 \clbrdrb\brdrs\brdrw10 \clbrdrr\brdrs\brdrw10 \cltxlrtb\clftsWidth3\clwWidth1620\clshdrawnil \cellx8100\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 * Comp }{\fs16\charrsid4798308 {\field{\*\fldinst SYMBOL 68 \\f "Symbol" \\s 8}{\fldrslt\f3\fs16}}}{\fs16\charrsid4798308 means annual compound growth rate \par }\pard \ql \li0\ri0\sb120\sa120\keepn\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b {\*\bkmkstart _Toc501346123}{\*\bkmkstart _Toc506803231}{\*\bkmkend _Toc501346122}A.}{\b\charrsid6316952 3.4\tab The value of X{\*\bkmkend _Toc501346123 }{\*\bkmkend _Toc506803231} \par }\pard\plain \s53\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\f40 The key variables on which the 糖心原创 has had to make assumptions for setting the value of X have been set out above. These results include estimates of actual and expected productivity gains for both the whole-of\endash Telstra, and actual productivity gains for the price-capped-basket-specific and PSTN-specific productivity measures. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Whole-of-Telstra TFP \par }\pard\plain \s53\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\f40 The 糖心原创\rquote s estimates suggest that the whole of Telstra has the potential to achieve a TFP growth rate of 10 per cent per annum over the next three years. That said, the 糖心原创 understands that Telstra may anticipate growth rates to be lower than this. \par In applying these results to the recommended basket of price-controlled services, however, care must b e exercised as there are good reasons to believe the TFP for Telstra as a whole could be in excess of that for the price-controlled services. This is because, on the whole: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {these are more \lquote traditional\rquote services with mature demand \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {although technological advances to improve TFP for these services are being realised, such advances may not be as prominent as they would be for other services. \par }\pard\plain \s53\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\f40 Hence, the 糖心原创 believes 10 per cent is an upper bound to the TFP growth rate that could be projected for the price-capped basket or for the PSTN. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Price-capped service-specific TFP \par }\pard\plain \s53\ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\f40 Estimates by the 糖心原创 indicate that TFP growth for the price-capped services has been at a rate of 6.2 per cent over the period from 1999-00 to 2003-04, and that this rate of growth is likely to continue over the next three years. \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid730655 Broad \lquote PSTN \rquote TFP \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid4942679 TFP measures for the broader PSTN/ISDN/xDSL show that an annual rate of 5.7 per cent over the period, 1999-00 to 2003-04. An alternative scenario however shows an}{ annual average growth rate of 6.1 per cent.}{\f40\charrsid621625 \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Economy-wide TFP \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The ABS estimates of the economy-wide multi-factor productivity (MFP) are taken to represent TFP growth rates for the economy as a whole. Table A.6 shows that, over the period from 1998-99 to 2002-03, the annual average growth rate o f the economy-wide MFP was three quarter of one per cent. \par }\pard \ql \li0\ri0\sa240\keepn\widctlpar\tx1260\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\b\charrsid2979227 Table }{\b A.6}{\b\charrsid2979227 \tab Economy-wide multi-factor productivity, 199}{\b 9}{\b\charrsid2979227 to }{\b 2003}{ \charrsid2979227 \par }\trowd \irow0\irowband0\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw30\brdrcf11 \clbrdrl\brdrtbl \clbrdrb \brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalt\clbrdrt\brdrs\brdrw30\brdrcf11 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalt\clbrdrt\brdrs\brdrw30\brdrcf11 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 Year\cell Productivity index\cell Growth Rates\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow0\irowband0\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw30\brdrcf11 \clbrdrl\brdrtbl \clbrdrb \brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalt\clbrdrt\brdrs\brdrw30\brdrcf11 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalt\clbrdrt\brdrs\brdrw30\brdrcf11 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\row }\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt \brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt \brdrs\brdrw15\brdrcf11 \clbrdrl\brdrs\brdrw15\brdrcf11 \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1998-99\cell }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 98.9\cell 2.3% \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow1\irowband1\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrs\brdrw15\brdrcf11 \clbrdrb \brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 1999-00\cell }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 98.4\cell -0.5% \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow2\irowband2\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrs\brdrw15\brdrcf11 \clbrdrb \brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\row }\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2000-01\cell }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 97.0\cell -1.4% \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow3\irowband3\ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 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\trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrs\brdrw15\brdrcf11 \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb \brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 2002-03\cell }\pard \qc \li0\ri0\sb60\sa60\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\fs20\charrsid4798308 100.4\cell 0.4%\cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\trowd \irow5\irowband5 \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrs\brdrw15\brdrcf11 \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb \brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw15\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\row }\trowd \irow6\irowband6\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrtbl \clbrdrb \brdrs\brdrw30\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw30\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw30\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\pard \qc \li0\ri0\sb60\sa60\keepn\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 {\b\fs20\charrsid4798308 Average\cell 0.75%\cell \cell }\pard \ql \li0\ri0\widctlpar\intbl\aspalpha\aspnum\faauto\adjustright\rin0\lin0 { \trowd \irow6\irowband6\lastrow \ts11\trgaph108\trleft0\trbrdrt\brdrs\brdrw30\brdrcf11 \trbrdrb\brdrs\brdrw30\brdrcf11 \trftsWidth1\trftsWidthB3\trftsWidthA3\trpaddl108\trpaddr108\trpaddfl3\trpaddfr3\tbllkborder\tbllkshading\tbllkfont\tbllkcolor\tbllkbestfit\tbllkhdrrows\tbllkhdrcols \clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrtbl \clbrdrb \brdrs\brdrw30\brdrcf11 \clbrdrr\brdrnone \cltxlrtb\clftsWidth3\clwWidth2694\clshdrawnil \cellx2694\clvertalt\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrnone \clbrdrb\brdrs\brdrw30\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2126\clshdrawnil \cellx4820\clvertalb\clbrdrt\brdrs\brdrw15\brdrcf11 \clbrdrl\brdrtbl \clbrdrb\brdrs\brdrw30\brdrcf11 \clbrdrr\brdrtbl \cltxlrtb\clftsWidth3\clwWidth2268\clshdrawnil \cellx7088\row }\pard \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 {\fs16\charrsid4798308 Source: ABS Cat. Number 5204.0}{\f40\fs16\charrsid4798308 \par {\listtext\tab}}\pard\plain \s4\ql \li0\ri0\sa120\keepn\widctlpar\jclisttab\tx0\aspalpha\aspnum\faauto\ls4\ilvl3\outlinelevel3\adjustright\rin0\lin0\itap0 \b\i\fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {糖心原创\rquote s draft view \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\f40 The 糖心原创\rquote s analysis based upon Telstra data suggests the TFP for Telstra as a whole has the potential to grow at 10 per cent per annum over the next three years, and that for the price-capp ed-basket is likely to grow at 6.2 per cent per annum. The 糖心原创 believes that this latter TFP is particularly relevant given the composition of the basket of ongoing services that it is recommending to be price-capped. \par }{As indicated earlier, there are good arguments to believe target TFP levels should be calculated according to the \lquote TFP minus\rquote rule. Under this rule, the target TFP level is calculated by subtracting the TFP for the economy as a whole from Telstra\rquote s TFP growth. Subtracting the economy-wide TFP average growth rate for the 5 years to 2002-03 of approximately 0.75 per cent from the price-capped-basket-specific TFP measure results in a \lquote net\rquote TFP growth of around 5.45 per cent per annum over the coming three years. \par In addition to the price-capped-basket-specific measure, the 糖心原创 has also considered the productivity growth in the fixed line network as a whole\emdash which has experienced on average a slightly lower growth rate. \par Based on the considerations discussed above, the 糖心原创 believes that it would be reasonable to set an X in order of 5.0 per cent to a broad basket of price-capped services comprising line rentals, local calls, domestic and international long-distance calls, and fixed-to-mobile calls. \par While estimating a precise level of X involves makin g a number of assumptions and accounting for a range of factors, the 糖心原创 considers that its estimate is reasonable and robust having regard to the results of the various sensitivity checks that have been made. \par }\pard\plain \s2\ql \li0\ri0\sb240\sa240\keepn\widctlpar\aspalpha\aspnum\faauto\outlinelevel1\adjustright\rin0\lin0\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {\charrsid6712068 {\*\bkmkstart _Toc501346131}{\*\bkmkstart _Toc506803235} {\*\bkmkstart _Toc86729698}{\*\bkmkstart _Toc87678301}A.4{\*\bkmkend _Toc444600336}\tab Summary and conclusions{\*\bkmkend _Toc506803235}{\*\bkmkend _Toc86729698}{\*\bkmkend _Toc87678301} {\*\bkmkend _Toc501346131} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\ilvl12\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {This appendix discusses a number of issues relevant to the CPI \endash X per cent price cap formula should the Government decide to continue to apply this form of price control arrangement to Telstra. In summary, the following conclusions and recommendations are made: \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard\plain \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {the value of X in the CPI \endash X formula should be determined with reference to past and prospective growth of TFP \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {based on the TFP growth experienced over 1999-00 to 2003-04\emdash for Telstra as a whole, for the Telstra PSTN/ISDN/xDSL infrastructure, for the price-capped basket and for the entire economy \emdash and on the projected TFP growth for Telstra as a whole for the period from 2004-05 to 2006-07, the 糖心原创 believes that a level for X of in the order of 5.0 per cent per annum is appropriate \par {\pntext\pard\plain\s27 \f10\fs28 \loch\af10\dbch\af0\hich\f10 \'a7\tab}}\pard \s27\ql \fi-360\li360\ri0\sa240\widctlpar\jclisttab\tx360{\*\pn \pnlvlblt\ilvl0\ls3\pnrnot0\pnf10\pnfs28\pnstart1\pnindent360\pnsp120\pnhang {\pntxtb \'a7}} \aspalpha\aspnum\faauto\ls3\adjustright\rin0\lin360\itap0 {the preferred option is to continue with the historical eight capital average CPI recorded in the year to the previous March quarter. \par {\listtext\pard\plain\s1 \b\fs36 \hich\af0\dbch\af0\loch\f0 Attachment B\tab}}\pard\plain \s1\ql \fi-360\li360\ri0\sa480\keepn\pagebb\widctlpar\jclisttab\tx360\aspalpha\aspnum\faauto\ls15\outlinelevel0\adjustright\rin0\lin360\itap0 \b\fs36\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { {\*\bkmkstart _Toc87678302}Public consultation{\*\bkmkend _Toc87678302} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 { The 糖心原创 received submissions from many interested parties in response to its Discussion Paper that it released in June 2004. In addition, the 糖心原创 conducted a series of public meetings in 12\~locations in Australia\emdash including metropolitan, regional and remote locations. \par {\*\bkmkstart _Toc86729700}{\*\bkmkstart _Toc87678303}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 B.1\tab}}\pard\plain \s2\ql \li0\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx792\aspalpha\aspnum\faauto\ls15\ilvl1\outlinelevel1\adjustright\rin0\lin0\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Submissions in response to the discussion paper{\*\bkmkend _Toc86729700}{\*\bkmkend _Toc87678303} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The 糖心原创 received public submissions from the following interested parties: \par AAPT\line Australian Consumers\rquote Association\line Australian Telecommunications Users Group (ATUG)\line Competitive Carriers\rquote Coalition (CCC)\line Consumers\rquote Telecommunications Network (CTN)\line Hutchison Telecommunications\line Optus \line The Smith Family\line Telstra \line Vodafone\line Western Australian Department of Industry and Resources (WA Government)\line Mr J Bondin\line Mr J Carter\line Mr P Evans\line Mr M Fowler\line Ms D Pergolotti\line Ms R Williams \par {\*\bkmkstart _Toc86729701}{\*\bkmkstart _Toc87678304}{\listtext\pard\plain\s2 \b\fs30 \hich\af0\dbch\af0\loch\f0 B.2\tab}}\pard\plain \s2\ql \li0\ri0\sb240\sa240\keepn\widctlpar \jclisttab\tx792\aspalpha\aspnum\faauto\ls15\ilvl1\outlinelevel1\adjustright\rin0\lin0\itap0 \b\fs30\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {Public meetings{\*\bkmkend _Toc86729701}{\*\bkmkend _Toc87678304} \par }\pard\plain \ql \li0\ri0\sa240\widctlpar\aspalpha\aspnum\faauto\adjustright\rin0\lin0\itap0 \fs24\lang3081\langfe3081\cgrid\langnp3081\langfenp3081 {The locations and dates of the public meetings conducted by the 糖心原创 are listed below: \par Cairns\tab \tab \tab 23 August 2004\line Brisbane\tab \tab 23 August 2004\line Canberra\tab \tab 24 August 2004\line Wagga Wagga\tab \tab 24 August 2004\line Sydney\tab \tab 26 August 2004\line Dubbo\tab \tab \tab 27 August 2004\line Hobart\tab \tab \tab 30 August 2004\line Melbourne\tab \tab 31 August 2004\line Adelaide\tab \tab 31 August 2004\line Perth\tab \tab \tab 1 September 2004\line Darwin\tab \tab \tab 2 September 2004\line Alice Springs\tab \tab 3 September 2004 \par }}