news The national competition regulator has declared it is satisfied with a new deal which the nation’s largest telco Telstra has offered rivals with respect to its controversial fibre replacement program in the South Brisbane exchange area, in a move immediately welcomed by the big T.
Telstra has chosen to replace the copper connections to about 20,000 premises in the region as the exchange — where the copper cables terminate — is being closed in order to make way for the new Queensland Children’s Hospital in the area. The region is one of the first in Australia to receive fibre services to the home — but is not part of the Federal Government’s flagship National Broadband Network project, although the long-term plan is for the infrastructure to become part of the NBN.
However, over the past year other major ISPs such as iiNet and Internode have expressed strenuous complaints about Telstra’s handling of the situation, with issues ranging from the company’s wholesale prices — which are claimed to be markedly higher than equivalent broadband prices on the previous copper network — to the lack of equivalent services such as the ability to stream IPTV services via multi-cast. Last week Optus CEO Paul O’Sullivan added his voice to the complaints.
However, in a statement which appeared to have been issued this week, the Australian Competition and Consumer Commission (ACCC) appears to have signalled it is now satisfied with Telstra’s response to the issue.
“In response to industry concerns about the adequacy and timing of information provided by Telstra, the ACCC wrote to Telstra regarding the closure of the exchange in September 2010,” the regulator wrote.
“Subsequently, access seekers acquiring regulated unconditioned local loop (ULLS) and line sharing (LSS) services raised further concerns about the likely effect on competition when these copper-based wholesale inputs are withdrawn. The ACCC has been in ongoing discussions with Telstra during 2011 regarding the terms of access for fibre-based wholesale services in South Brisbane.”
Telstra, the ACCC noted, had now advised the regulator that it had offered improved terms of access to the other ISPs.
“The ACCC considers that Telstra’s offer is capable of resolving the primary commercial concerns raised by access seekers,” the regulator wrote. “In particular, the revised terms will enable service providers to continue their service offerings, and ensure that consumers in South Brisbane have a range of options in terms of both products and providers.” The regulator added that it would consider any new issues with regard to South Brisbane if and when they arose.
It also appears as if the ACCC may have considered the matter as part of a draft determination into regulation of what is known as a ‘bitstream’ service.
In a joint submission to the Australian Competition and Consumer Commission published in September (PDF) filed by law firm Herbert Geer, iiNet and Internode arguing that wholesale fibre services in Australia should be included in the definition of what is known as a ‘Bitstream’ wholesale service, with particular reference to the “unacceptable” situation in South Brisbane. The ACCC yesterday published a draft determination in the matter (PDF). However it is not clear from the determination how the ACCC reacted to the ISP’s comments.
The ACCC has also issued a statement on the bitstream issue.
“Although the service has not been declared at this stage, the ACCC is moving towards finalising the service description,” ACCC chairman Rod Sims said. “This is a chance for industry to have a final say before the local bitstream access service becomes permanent with no future opportunity for adjustment.”
A spokesperson for Telstra’s Wholesale division immediately welcomed the news. “We have been working closely with our wholesale customers and the ACCC over the last 18 months to ensure the transition runs as smoothly as possible and this outcome reflects that constructive and transparent engagement,” they wrote.
Representatives from Optus, iiNet and Internode have been invited to comment on the matter.
Cue howls of outrage from the various telcos involved. The fact that Optus CEO Paul O’Sullivan was complaining about South Brisbane last week does not bode well for the idea that all of Telstra’s wholesale ISP customers are on board with this resolution. I would be very surprised if an amicable outcome has been reached for all concerned.