Telstra Corporation Ltd, the Australian telecoms giant, has defended its intentions of offering exclusive content via Foxtel, provider of pay television, asserting that the deal was done at "arm's length" and rejecting claims of non-competition reported by Fairfax.

In a report submitted to the ACCC (Australian Competition and Consumer Commission), Telstra Corp, a major shareholder of Foxtel, said their decision was not related whatsoever with its shares in Foxtel, despite competitors' claims that the move was anti-competitive.

In the previous month, Telstra Corp was also questioned when Foxtel submitted a request to the ACCC to permit its internet TV service to be exclusively accessible to customers of Telstra.

The ACCC is presently examining whether Foxtel can really supply internet television through set-top iQ boxes on the exclusive provision that customers connect via the BigPond internet broadband service of Telstra Corp.

Fairfax states that according to Telstra, only a few of the customers who could avail of the service were not with BigPond already, and it was kind of "unlikely that there could be any material impact on competition".

Optus, rival telecoms company and Singapore Telecommunications Ltd's subsidiary, said in its report that it will likely lose current and future customers because those who want to avail of Foxtel's service had no other choice but to subscribe to Telstra's BigPond as well.