The telstra company that runs the internet has announced it will shut down the web hosting company that serves the internet, but will keep its own server in Australia.
The company will sell the remaining server to an Australian web host, as the Australian government has requested that telstra sell its hosting business.
The Australian government says that Telstra’s move is “illegal” and that the company is “not in compliance” with Australian law.
Telstra said the decision was “not a matter of principle.”
Telstra spokeswoman Linda Deakin told CNN the telstra service provider was a partner with a local hosting provider, which is owned by Telstra.
The telcos hosting business has been in operation since 2003.
The decision comes after the Australian Competition and Consumer Commission said the telcos pricing practices were unfair and misleading, and threatened legal action.
Telstol, which has been involved in internet services since 2002, said the Australian Government’s request for the auction of its hosting assets was an “overreach” and it would not be able to “obtain and sell the assets without a court order.”
It said it will not sell any of the assets to Australian web hosting companies unless the government provides a “compelling reason.”
Telstols move follows the US move last week to end the business of a private internet service provider.
The Federal Communications Commission said last week it would stop granting a special license to Comcast for its internet service in the United States, citing its price control practices.
The commission said that “no market-based price should be used to determine the value of a telecommunications service to consumers in the US.”
Telstar, which operates a similar business to Telstra, is also planning to close its US operations.
The move comes just weeks after the US Department of Justice said it would pursue charges against Comcast for “false advertising,” and after the Federal Trade Commission accused Comcast of violating net neutrality rules.
CNN’s Jim Sciutto contributed to this report.