Telstra says NBN Co regional plans will limit choice

Telco disagrees with product offering choice and network interconnet proposals for the NBN

Telstra has disagreed with the NBN Co’s proposal to have only 100 to 200 points of interconnect (PoI) in the National Broadband Network (NBN), saying the move is “neither pro-competitive nor pro-choice”.

In its submission to a NBN Co consultation process on proposed wholesale fibre bitstream products, Telstra also said the move to not offer Local Ethernet Bitstream (LEB) products where it offers Aggregated Ethernet Bitstream (AEB) products — which enables users to gain access to one or more fibre serving areas over an aggregated link — will also limit competition and commercially disadvantage companies that have “deployed or are deploying contested backhaul infrastructure to areas that NBN Co is proposing to be subject to aggregation”.

“It will not facilitate differentiation and innovation by Retail Service Providers (RSPs), nor will it promote maximum end-user choice, which is contrary to NBN Co’s stated objectives,” the Telstra submission reads. “It will effectively mean that NBN Co will become the sole, exclusive provider. This is not consistent with the Government’s aim for the NBN to deliver better and fairer access to infrastructure, nor will it meet the Government’s objective to improve the competitive market in regional Australia. Instead it will remove the ability of NBN Co’s customers to acquire services from an existing infrastructure provider, thereby limiting choice that would otherwise be available. There is no basis for NBN Co imposing this restriction on competition.”

Telstra went on to say it would be contrary to the policy objectives of the Regional Backbone Blackspots Program and discourage further investment in regional infrastructure.

“Additionally, Telstra believes that there are several hundred exchange service areas in regional areas that are currently or could be served by more than one fibre owner, and that this number will only increase under the Government’s backhaul blackspots program. The number of PoIs should be progressively increased to reflect this high level of competitive investment.”

In short, Tesltra contends that the PoI and product offering proposals will prevent wholesale customers who have “already deployed or wish to deploy their own infrastructure, or who have purchased or wish to purchase backhaul from another provider, from using that infrastructure”.

“It also tilts the competitive playing field in favour of those who have not invested or purchased capacity on regional routes, and risks NBN Co’s ability to deliver the most cost-effective solution for the industry,” Telstra said.

Aside from these arguments, Telstra expressed support for the Layer 2 approach being taken by NBN Co and agreed in principle with the choice of Ethernet and Gigabit Passive Optical Network (GPON) technologies.

“Telstra recommends NBN Co adopt a transparent and robust process for determining the location and number of PoIs, and provide wholesale customers with the ability to acquire either the LEG or the AEB in regional areas.”

Telstra’s full response can be read on the NBN Co website.

Overall, NBN Co has claimed industry support for the majority of its network decisions.

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