FASTER broadband services could actually make ethnic communities more insular by creating "digital ghettos", SBS has warned.

The multicultural broadcaster expressed its concern about better access to overseas websites in a written submission to a parliamentary inquiry.

"The ubiquitous nature of broadband increases the possible formation of 'digital ghettos' among Australia's culturally and linguistically diverse communities," it said.

While SBS saw benefits in the National Broadband Network, it also worried that it could give ethnic groups another outlet to "retreat inward" if they felt threatened or vulnerable.

SBS's submission was one of 186 handed to a House of Representatives committee on communications, which is due to visit Tasmania tomorrow.

Optus said the NBN was critical to reforming the fixed-line communications sector, provided all internet service providers had equal access to the network.

"Compromise on any of these principles risks the failure of the competition and innovation aims of the reform," it said.

Its chief rival Telstra was more critical of the NBN.

In a submission to a separate Senate committee, Telstra called on the Government to ban NBN Co, the company building the network, from controlling an internet service provider.

NBN Co would be allowed to control a retailer for up to a year, but Telstra argues this would breach the Government's policy of making it a wholesaler only.

"There does not appear to be any meaningful justification for it," Telstra said.

The Australian Competition and Consumer Commission appeared to share Telstra's concerns when asked about this at the Sydney Senate hearing.

"I'd accept that there's always issues at the margin around whether ... the provision of services reflects the underlying policy intent of wholesale only," said the competition regulator's general manager of communication policy, Michael Cosgrave.

On another policy matter, the Australian Communications Consumer Action Network has urged the Government to reconsider plans to privatise the NBN, arguing a private monopoly could become too powerful.

"There are still significant groups in Australia that have some great concern about the privatisation of public utilities," chief executive Teresa Corbin told the hearing.

Local government supporters of the NBN include Warringah Mayor Michael Regan, whose northern Sydney council lies within the federal electorate of Opposition Leader Tony Abbott.