Retail price controls were introduced in 1989 to restrain Telstra’s pricing power. The market has changed since then. There are now more competitors and more options for phone services, such as VOIP and mobile services.
The purpose of the economic analysis was to provide advice about the future arrangements of retail price controls within the context of the Australian Government’s broader deregulatory agenda.
The report concludes that, with the development of a competitive retail market for telecommunications services, retail price controls are no longer necessary.