news The nation’s largest telco Telstra has confirmed it will not address several of the largest complaints by other ISPs about the way it is handling its new fibre rollout in the South Brisbane exchange area, despite signing a new accord regarding the region with Communications Minister Stephen Conroy.
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 Optus, 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 or offer so-called ‘naked’ services without an attached telephone line.
On Monday Communications Minister Stephen Conroy announced that Telstra would provide what he described as “an open access wholesale service” on fibre networks it is currently deploying in South Brisbane and also in some new housing estate projects.
For customers in those new housing estates, the deal is good news. As iTNews has documented in an extensive article on the subject, the deal will see Telstra’s fibre in those area opened up to retail competition for the first time, with rival ISPs like iiNet, Optus and TPG able to provide services over Telstra’s network, if they sign supply arrangements with the telco.
However, in both the new housing estates and in its South Brisbane network, Telstra has stated that it will not provide ‘naked’ services or allow multi-cast IP video services that would allow the ISPs’ own video platforms (typically FetchTV) to operate. “There is no change from the [South Brisbane Exchange fibre arrangement] that we have detailed with our customers in previous months,” a Telstra spokesperson said. “An underlying voice service is required for Telstra wholesale and retail customers because this is the way the network is configured and multi-cast is not supported by the network.”
In practice, what the deal signed between Conroy and Telstra means is that Telstra will be exempt from having to meet the Government and NBN Co’s regulations for the setup of new fibre infrastructure. Broadly, the regulations are meant to ensure that any new fibre infrastructure built around Australia has to match the standards of the NBN, so that NBN Co will not overbuild fibre infrastructure in areas where it already exists.
“We welcome this decision to exempt the South Brisbane Fibre network and other smaller specified ‘Velocity’ fibre networks these networks are set out in the Velocity networks exemption) from the Government’s ‘level playing field’ obligations,” the Telstra spokesperson said. “It provides Telstra and its wholesale customers with certainty concerning the availability of a broadband fibre product in these areas. Telstra has agreed to offer a Fibre Access Broadband (FAB) service to wholesale customers as a condition of this exemption.”
Telstra said it had been in discussion with NBN Co in relation to the South Brisbane exchange area — as this area is eventually expected to become part of the NBN. “These discussions continue,” the telco said. And it added that it had signed commercial deals in the area with 20 customers (usually retail ISPs) of its wholesale division.
Conroy said the deal would facilitate competition in the fibre areas covered by the arrangement, and it would be subject to scrutiny by the Australian Competition and Consumer Commission. The ACCC has already stated that it is satisfied with Telstra’s arrangements with customers in the region. However, it is likely that Telstra’s reluctance to offer naked broadband services and IPTV services over its fibre networks will continue to rankle other ISPs and their customers.
In addition, there are other issues which Telstra is facing in the South Brisbane area that have the potential to spill over into the new housing estate areas where it will also begin to open its networks to competition.
Internode has complained publicly about poor Telstra pricing in the South Brisbane exchange area, stating that its own higher pricing in the region was based on the “crazy” underlying wholesale costs which it said Telstra was charging for other ISPs to access its new infrastructure. TPG is also charging higher prices in the region than on other copper infrastructure, and it remains unclear what Telstra’s wholesale pricing on the fibre infrastructure in the new housing estates will look like.
It remains unclear why both the ACCC and Communications Minister Stephen Conroy are unwilling to take more drastic action with respect to Telstra’s obviously uncompetitive actions with regard to its fibre networks located around Australia.
It seems like common sense that Telstra should not be simply allowed to replace its existing copper network with a fibre network in certain areas and then be able to completely change its wholesale service offering to retail ISPs, charging them radically different prices for access to the infrastructure and not offering fairly basic services such as broadband without a compulsory associated telephone line. Especially when it seems like much of this infrastructure will eventually become part of the National Broadband Network.
I believe Telstra is not speaking correctly when it says it cannot support naked broadband or multi-cast IPTV streaming services over these fibre networks. I am very sure that this is technically possible. The phrase ‘don’t rock the boat’ comes to mind when I think of the actions of the ACCC and Conroy with regard to this contentious and ongoing issue.
Image credit: Telstra