ACCC expresses concern about uncertain framework

Uncertainty in the current telco climate continues to hamper deployment of broadband rollouts and next generation services, according the Australian Competition and Consumer Commission.

With no clear regulation framework in place for Australia's next generation networks (NGN), big expenditures by carriers will not proceed, meaning consumers will be worse off until such changes are made, said Graeme Samuel, chairman of the ACCC.

Speaking at the Australian Telecommunications Summit 2006 in Sydney on Monday, he said Telstra would not commit to putting forward a detailed proposal on its much hyped Fibre to the Node (FTTN) rollout until changes to the Trade Practices Act made it viable for it to proceed.

"At the same time, the ACCC is aware that a number of carriers have well-advanced plans to take up large numbers of ULLS (Unconditioned Local Loop Services) to deploy DSL infrastructure. These competitors currently find themselves in a state of uncertainty and doubt about the viability of their existing ULL-based businesses. For example, how long, how much, and where will ULL be available if FTTN is to be built? And at what prices?"

Unbundling the local loop is the process where carriers and service providers get cheap wholesale access to Telstra's existing copper wire network. It is through the ULL that consumers today get services such as ADSL from alternative providers to Telstra.

An FTTN network is expected to offer the same services, but it is argued with much bigger capacity than if they were delivered over copper.

"In addition, the extent that it is technically workable for copper to exist alongside FTTN is unclear - so these competitors face a risk that their existing DSLAMs could become stranded. Compounding all of these concerns is the ambiguity as to whether FTTN will even proceed. The ACCC is acutely aware that these concerns need to be resolved promptly if the competitive momentum that has emerged in the past couple of years is to continue."

Talk about requiring certainty in the telco market in order for Australia to advance is not new.

Telstra's general manager of regulatory affairs, Tony Warren, has been a vocal critic of the current state of regulation. He has argued on a regular basis that the telecommunications industry has successfully changed since deregulation; however, the regulation of the industry has not.

In the meantime the industry is approaching the tenth anniversary of the Telecommunications Act of 1997, an act which introduced the concept of self-regulation.

According to Ann Hurley, CEO of the ACIF, this the time for the entire industry to work together on building a future framework.

She said if issues can be identified and responsibility is taken for resolving them, "We will demonstrate that industry collaboration and self-governance should be the default option for NGN transition."

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