ACCC Flags Telstra-NBN Concerns

ACCC Flags Telstra-NBN Concerns

The Australian Competition and Consumer Commission yesterday published its concerns about potential competition issues with regard to Telstra constructing elements of the National Broadband Network (NBN).

The concerns relate to the rollout of Hybrid Fibre Co-Axial (HFC) technology, which will be used by around 4 million premises – mainly in Australia’s capital cities.

The deployment will transform the cable networks built in the 1990s into conduits for delivering fast broadband to homes and businesses. Cable broadband is used widely in other countries, including the USA; which has more than 60 million homes connected using the technology.

HFC broadband technology - NBN

Commercial agreements between Telstra and NBN Co, made on 21 December 2015 and 11 April 2016, with regard to this rollout have been under the spotlight.

“NBN Co and Telstra have said that one of the benefits of these commercial agreements is that it will facilitate a faster rollout of the NBN, which the ACCC acknowledges, but we also recognise that there are potential competition implications and the effect of these on end users is just as important,” ACCC Chairman Rod Sims said.

The ACCC has flagged the arrangements may give the telco a head-start in providing customers NBN HFC broadband services, preferential service activation and/or repair of services for its own customers, and greater access to information regarding the NBN rollout than competitors.

While NBN Co and Telstra have agreed to a number of measures that in the view of the ACCC will mitigate some of the potential risks to competition,  the Commission believes there’s still work to do on a number of remaining issues.

” We will continue to monitor the relationship between NBN Co and Telstra, and ensure that Telstra’s contracts with NBN Co do not give it an advantage over its competitors in providing superfast broadband services over the NBN,” said Mr. Sims.

Part of the monitoring includes oversight of the extent to which NBN Co is able to use the ‘accelerated model’ in building the NBN in Telstra HFC areas.

This model includes network design and construction being optimised so existing HFC assets are used to release as much NBN footprint as rapidly as possible. Concerns have been raised for the potential of unfair advantage from use of NBN funded improvements to the Telstra HFC network prior to these improvements being accessible to other service providers.

The ACC assessment of NBN Co -Telstra service delivery agreements report can be viewed in full here (PDF).

Image Credit: BigStock

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