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AUSTRALIA has the second-slowest broadband speed in the developed world, according to the latest international comparison by the OECD.
Australia lagged behind Turkey and Greece, and only just pipped the Slovak Republic.
The review shows that not only is Australia's broadband among the slowest, but its telephone services are also among the most expensive, particularly for small business.
Telstra's maximum broadband speed has increased since the OECD survey was conducted in October last year, rising from 1.5 megabits a second to up to 24 megabits a second.
However, leading nations such as France, Italy, Sweden and the US offer speeds that are between 30Mbps and 40Mbps, while Japan and Korea offer speeds of 100Mbps.
The OECD review also highlighted the cost of telecommunications services. For Australian small businesses, phone and internet costs are the third highest in the world.
A bundle of telecommunications services that cost a business $36,000 a year in Australia would cost $14,000 in the US.
A home office with fixed-line telephone costs of $950 a year in Australia could get the same service for $300 in the US.
Small business communications costs in Australia are about 40 per cent higher than the OECD average. Only Poland and the Czech Republic are more expensive.
Labor telecommunications spokesman Stephen Conroy said the cost of telecommunications charges for small business was a disgrace. "Small businesses are being held back from developing, exporting and innovating because of the high costs they face in Australia," Senator Conroy said.
Consumer fixed and mobile telecommunications costs are in the most expensive third of the developed world.
A spokesman for Communications Minister Helen Coonan said all telecommunications costs in Australia had come down by 26 per cent since 1997 and it was recognised that Australia's vast distances and low population density created challenges.
The OECD stressed the importance of introducing competition. "Markets with healthy levels of competition have led the introduction of innovative services and appealing pricing packages," the report said.
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