For decades, Australian telco has operated as a feudal system. A small number of kingly carriers own the tech infrastructure that carries communications. Typically, they sell big chunks of comms capacity to lordly sub-wholesalers who in turn parcel it out to serfish retailers at the bottom of the social order.

This structure explains a lot that's wrong with the sector. For instance, many consumer agreements are loaded with terms that breach the national anti-unfair contracts laws. Often, they're mandated by upstream suppliers who call the shots. If the retailer wants wholesale supply, they have to toe the line.

We once took that issue up with a senior Victorian consumer protection bureaucrat, arguing they could solve a lot of telco problems by leaning on the comms landlords instead of their subservient tenants. "But we are consumer affairs," they insisted, "not wholesaler affairs."

Displaying somewhat more insight, the ACMA has responded to Fifield's directive with a draft industry standard explicitly calling on everyone in the supply chain to come to the aid of consumers by giving reasonable assistance to the customer-facing retailer.

It's all keyed around complaint handling. Most of the proposed new standard deals with retailer obligations to design and operate robust complaint handling processes that deal with customer problems as quickly as possible – in a single contact where possible.

Similar rules for good management of complaints have been in operation since 2013, when the industry-driven Telecommunications Consumer Protections (TCP) code was upgraded. The TCP code has worked well in this regard but, as Fifield noted in December, "there are currently gaps in complaints-handling processes, including as a result of supply chain complexities".

Actually, the same sort of gaps have undermined the industry's customer service since long before the NBN was conceived, but telecoms wholesaling has never been a matter of public debate before. That's no accident. Some key wholesalers have long imposed terms on their retail vassals banning them from even suggesting that any service problems might be the fault of the wholesaler. NBN is the first telco wholesaler that ever sought a public profile.

Divided loyalties


As much as the draft industry standard is a step in the right direction, it falls short in a key respect, and that's the case of outfits such as Telstra, Optus, TPG and Vocus, which supply services on a wholesale basis to fleets of retailers and conduct their own retail operations, either directly or through subsidiaries.

For the industry standard to bite with anything more than baby teeth, it needs to mandate that a telco with dual wholesale and retail arms must lend the same standards of assistance to its independent retailer customers as it does to its in-house retail operations. The public may well ask what the ACMA's standard means by "reasonable" assistance. Well, same as you give your own team is a good start at a definition.

The point isn't academic. Following a recent Australian Competition and Consumer Commission demand for more accurate marketplace information about real world broadband speeds, we asked one wholesaler to agree to provide our side with the same compliance data as it gives to its in-house retailer. Nope.

In other contexts, it's the law that a telco wholesaler that also retails can't discriminate between its own retail division and third parties. Neither should they be able to when it comes to solving consumer complaints.

Peter Moon is a technology lawyer with Cooper Mills. peter.moon@coopermills.com.au