ACCC Rules Put A Stop To Telstra’s NBN Advantage

The Australian Competition and Consumer Commission is keeping a close eye on Telstra, amid concerns the telco’s involvement in building NBN infrastructure may give it an unfair advantage on the competition when it comes to signing customers up for connections.

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“NBN and Telstra have said that one of the benefits of these commercial agreements is that it will facilitate a faster rollout of the NBN, which the ACCC acknowledges, but we also recognise that there are potential competition implications and the effect of these on end users is just as important,” ACCC Chairman Rod Sims said.

The ACCC today released a report which outlines the main concerns with Telstra’s involvement in building the NBN. Namely, the potential for a “head start” in connecting customers to NBN HFC broadband services, preferential service activation and/or repair of NBN broadband services for its own customers, and greater insight than its competitors into the NBN rollout.

The ACCC says NBN and Telstra have agreed a number of measures that the ACCC considers will mitigate the potential risks to competition, which the ACCC will continue to monitor.

This includes making NBN HFC connections available to all service providers simultaneously and NBN setting priorities on activation and repair work that it allocates to Telstra which the telco must follow, and de-identifying work orders from other retail service providers.

Telstra will also need to provide “white label” activation and repair services to NBN, with its field workforce following non-discrimination rules when attending end-user premises.

“The ACCC is pleased at the progress made to date in terms of these agreements, but there’s still work to do to address our remaining concerns. We will continue to monitor the relationship between NBN Co and Telstra, and ensure that Telstra’s contracts with NBN Co do not give it an advantage over its competitors in providing superfast broadband services over the NBN,” Mr Sims said.

The ACCC says it is now working to ensure all access seekers have more rollout information, and receive reports on whether or not they are receiving equivalent treatment.

The NBN/Telstra service delivery agreements were announced on 21 December 2015 and 11 April 2016 and are for the supply, amongst other things, of network activation and assurance services and network planning, design, construction, and construction management services.

In preparing this report, the ACCC consulted with a number of broadband retail service providers and raised a number of potential concerns with NBN and Telstra to ensure that they were known to the parties as the details of the agreements were developed.

NBN and Telstra did not make their binding agreements subject to ACCC approval. Nor did the parties defer implementing them during the ACCC’s review.

The next step in this matter will be to establish suitable arrangements for monitoring of the implementation of the agreements, including NBN’s reporting of rollout information to its access seekers, ahead of the HFC construction program reaching scale later this year.