ACCC to Maintain Control of NBN Pricing 1

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Tuesday, October 1st, 2013
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Rod Sims
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Australia’s chief competition watchdog will order amendments to the pricing regime for the national broadband network (NBN) despite major changes to the infrastructure mega-project in the wake of the Coalition’s election win.

Rod Sims, chairman of the Australian Competition and Consumer Commission (ACCC), has announced that the country’s top competition authority will issue a notice to NBN Co outlining further amendments to its special access undertaking (SAU), which is the primary document determining pricing and access for the nation-wide network.

“Settling the SAU will provide access seekers the certainty they seek, even if the new government’s policies require consequential changes at a later stage,” Sims said during a speech he delivered to the International Symposium for Next Generation Infrastructure held in Wollongong.

The SAU sets the rates paid by telecommunications operators such as Telstra or iiNet for NBN access and the extent of any price increases that NBN Co is permitted to implement from now until the year 2040.

Pricing directives were originally scheduled for release prior to the federal election, although the ACCC delayed its decision concerning the SAU in order to better determine the implications of a change in government and the Coalition’s alternative vision for the NBN for access and pricing terms.

Sims said the ACCC also wishes to retain the ability to review pricing for the NBN in future so it can “rebalance” charges for the connectivity virtual circuit (CVC) if the cost for NBN capacity becomes “inappropriate over time.”

Under the current arrangement, any service providers must sign year-long contracts with NBN Co on order to gain access to the NBN for their own operations.

Sims’ comments stand in marked contrast to position of the ACCC only a week ago, when a spokesperson for the authority said that it was “still reviewing whether there is any impact on the NBN SAU process as a consequence of the change in government.”

The Coalition government’s plans to drastically reduce the scale of the NBN from a fibre-to-the-home to a fibre-to-the-node arrangement are expected to reduce capital expenditures for the project from $37.4 billion to $20.5 billion.

This, in tandem with changes to policies concerning broadband competition, are expected to result in major changes to the regulatory environment for the network.

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  1. Darryl

    This entire project has been a disgrace…. and likely will get even worse