Telstra take City of Melbourne to Federal Court over out-of-home advertising dispute

Telstra has taken the City of Melbourne to the Federal Court as part of its battle with local councils over digital out-of-home displays.

The telco’s move follows the council referring Telstra and JC Decaux’s new phone booths to the Victorian Civil and Administrative Tribunal earlier this year claiming the large format digital adverting displays were subject to local government planning rules.

A Telstra payphone with a digital display in central Melbourne

Melbourne claims the new generation payphones featuring large format digital displays are not ‘low impact’ under the Federal government’s telecommunications rules and therefore are not exempt from council regulations.

In April, the City of Sydney joined their Melbourne counterparts in objecting to Telstra and JC Decaux’s plans with councillors calling on Lord Mayor Clover Moore to seek support from various politicians and regulators for their view that Telstra’s plans are not exempt from council control.

The Sydney councillors called on Moore to write to the chair of the Australian Competition and Consumer Commission, Rod Sims; minister for communications, Mitch Fifield; shadow minister, Michelle Rowland; NSW Premier, Gladys Berejiklian; and the CEO of Telstra, Andy Penn to express their dissatisfaction with the advertising units.

JC Decaux and Telstra pulled out of the city’s street furniture tender in January with some sources claiming concerns about the large format payphone units were partly responsible for the scuttled bid for Australia’s largest out-of-home contract.

The two companies unveiled their Adbooth partnership in late 2017 to “bring the phone box into the 21st Century” with 1,860 payphones nationally being upgraded to include mobile phone charging ports, digital advertising screens, public transport information, interactive digital art along as multilingual and disability support services.

As part of Telstra’s Universal Service Obligation, the telco is required to provide payphones across the nation.

Carmel Mulhern, Telstra’s group general counsel and group executive for legal  and corporate affairs, wrote in a blog post on the company’s site: “To clarify whether the new booths are a low impact facility, the City of Melbourne recently commenced proceedings in the Victorian Civil and Administrative Tribunal (VCAT) challenging our right to upgrade payphones in the Melbourne city area.

“Because we operate a national payphone network, we think the best path is to ask the Federal Court to decide whether our new payphones are a low impact facility, so we have one judgment that applies across Australia. This will avoid the time and cost of court action in other states, and should mean a quicker, consistent outcome.

“Notwithstanding the decision to take this action, we will continue to engage and work with all stakeholders, including local governments and other associations on this project.”

A City of Melbourne spokesperson said the council expects VCAT to hold a directions hearing on the matter next week. The Federal Court is yet to schedule a hearing on Telstra’s case.

In a statement to Mumbrella, a City of Melbourne spokesperson told Mumbrella: ” On Monday 25 March, the City of Melbourne refused 81 applications by JCDecaux for planning permits to display commercial advertising on public phone booths across central Melbourne.

“Under the Telecommunications (Low-impact Facilities) Determination 2018, planning approval is not required to install telecommunications infrastructure provided it meets the criteria for ‘low-impact facility’.

“At 2.7 metres high and 1.2 metres wide, the new payphone structures are 600mm taller and 400mm wider than the older phone booths. They are also fitted with 75” LCD screens – which are 60 per cent larger than the previous signage displays – and which are programmed to show up to four advertisements per minute.

“In addition, the City of Melbourne applied simultaneously to the Victorian Civil and Administrative Tribunal (VCAT) seeking a ruling that Telstra’s new larger phone booths do not meet the low impact criteria and therefore require planning approval. The matter of City of Melbourne vs JCDecaux and Telstra is listed for a directions hearing before VCAT on Friday 17 May.

“We are also aware of media reports that Telstra intends to file a Federal Court action “to decide whether [Telstra’s] new payphones are a low-impact facility”.


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.