Senator Conroy told the conference: “The regulation of telecommunications powers in Australia is exclusively federal. That means I am in charge of spectrum auctions, and if I say to everyone in this room 'if you want to bid in our spectrum auction you'd better wear red underpants on your head', I've got some news for you. You'll be wearing them on your head ... I have unfettered legal power.”

A spokesman today said that Senator Conroy "was simply explaining to an international audience the nature of Australia's regulatory regime". A video of his speech has been made available online.

Speaking to the conference, Senator Conroy said if the proposal for increased cable access costs went ahead, he would consider building a new submarine cable to the US using the national broadband network (NBN) to avoid telcos paying the costs.

“We pay too much and that's why I do not support the proposal to charge (for internet settlements) between countries,” CommsDay reported Senator Conroy as saying.

Jon Lawrence, executive officer of online users' lobby group Electronic Frontiers Australia, said Senator Conroy had “perhaps watched one too many Spiderman movies” but also displayed “a worrying degree of arrogance” in his remarks.