Optus livid over NBN access amendments

Paul O'Sullivan threatens to pull out of arrangements with the network over Government amendments

Optus has warned amendments proposed to National Broadband Network (NBN) legislation proposed by communications minister, Senator Stephen Conroy, last night would be a step backwards for the telecommunications industry.

In a 23-page set of amendments delivered to the Senate for discussion and voting late Wednesday afternoon the Gillard Government made significant changes to “cherry picking” legislation. The new wording suggested all wholesale fibre networks built from 1 January this year onwards for residential and small business premises must be provided on a wholesale-only, open access basis in the same capacity as the NBN.

Optus chief executive, Paul O’Sullivan, today labelled the new amendments a “curve ball”, saying that the country’s second largest telco required reassurances from government around certain aspects of the bill.

Those reassurances would likely be made within the next 48 hours, he said.

“We’re concerned that they could alter the intent of all the legislation to create a level playing field and provide equivalence of access to all the players in the industry,” he said.

“We are looking at these amendments carefully; we are in a constructive discussion with government and we would hope to be able to get the necessary changes to these amendments that would allow us to support the bill being passed in the Senate.”

O’Sullivan, who today reiterated a proposal for an NBN oversight committee, was reluctant to detail which amendments specifically the telco objected to, and did not detail what actions, if any, the company would take should the bill be passed by the Senate with the government’s amendments intact. However, he said the amendments would mean a “step backwards” for the telecommunications industry, which was quickly removing the monopoly previously held by incumbent Telstra.

In a February submission to the senate inquiry surrounding NBN legislation (PDF), Optus argued changes were needed to ensure all internet service providers could seek access to the network on a level playing field, and that some carriers wouldn’t gain a unique advantage.

Optus also argued changes were required to provide more transparency in NBN operations and to “more clearly ring-fence the activities of NBN Co to providing clearly defined and specified wholesale-only fixed line access services”.

In particular, Optus argued against possible price discounts given by NBN Co to Telstra under proposed access arrangements, as a result of the $9 billion financial heads of agreement currently under negotiation between the parties.

Telstra last week delayed finalisation of that deal, pushing back a shareholder vote initially scheduled for July and potentially delaying rollout of the NBN at 14 second-release mainland sites.

O’Sullivan today confirmed that no progress had been made on a possible similar deal between Optus and NBN Co for use of infrastructure such as ducts and pipes where possible.

Concerned about potential unique advantages in an NBN environment, O’Sullivan even proposed potential criminal penalties on individuals to prevent a structurally separated Telstra from sharing information of NBN rollout timeframes between its wholesale and retail arms ahead of public disclosure to competitors.

“Certainly we’ve had a very negative experience with Telstra in the last several years where they took confidential information of ours gained through the access provision and made it available to their sales and marketing arms,” he said.

“Civil sanctions are not enough because financially it could be worthwhile for someone like Telstra to breach the rules of the game in order to get a market advantage so we’d like to see some criminal penalties for any executive who willingly chooses to breach the safeguards around competition.”

Follow James Hutchinson on Twitter: @j_hutch

Follow Computerworld Australia on Twitter: @ComputerworldAU

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Tags nbn cooptusSenator Stephen ConroyNational Broadband Network (NBN)Paul O'Sullivan

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