Telstra Corporation
(ASX:TLS) has had to defend a deal with Foxtel in which the Telco would offer the pay TV provider’s content exclusively to its broadband subscribers.
According to a Fairfax report Telstra, who holds a 50% stake in pay TV provider Foxtel, says the deal was conducted at arm’s length.
However the company’s competitors are accusing Telstra of trying to steal their customers.
The report in The Age newspaper says Telstra has defended the deal to the Australian Competition and Consumer Commission saying it was unlikely to lessen competition because only a small portion of customers who could potentially access the service were not with Telstra.
The Age reports the Telco saying this small amount totaled less than 6% of the total number of fixed-line broadband subscribers in Australia.
The paper says in a submission to the ACCC, rival Optus forecasts that it will lose existing and future customers, because customers who wish to purchase Foxtel’s proposed service will have no option but to purchase broadband services from Tesltra.
In the 2009 financial year Telstra earned profit of $4.073 billion.
