Telstra & ACCC talks on FTTN, purely informational

Stuart Corner
Monday, 24 July 2006 10:59

IT Policy - Regulation

For months now there have been reports that Telstra and the ACCC have been locked in difficult and complex negotiations aimed at enabling Telstra to rollout its FTTN network with the certainty around regulated access that Telstra seeks. However, ACCC chairman, Graeme Samuel claims the discussions have been simply about the ACC providing information to Telstra.

In a speech to The Australian Telecommunications Summit in Sydney today, Samuel said: "The purpose of these discussions has been to provide Telstra with some assistance and clarity concerning the requirements of the Trade Practices Act, so that if it were to make a proposal on an FTTN upgrade, it would be in a form that would allow for meaningful public consultation."

He added: "We have emphasised all along that no decisions could be made without full public scrutiny of a proposal...I understand that Telstra is still working on developing a proposal for public discussion."

Samuel said the discussions were "constructive" and the issues "complex" and being made more so by "Telstra appear[ing] to want to progress [ULLS] issues at least contemporaneously with, or even ahead of FTTN issues." The ULLS issue, he said was "especially challenging."
 
The ACCC is now faced with another FTTN proposal, that from the Group of nine carriers, also wanting regulatory certainty. "The G9 carriers are talking to the ACCC because they want certainty about their FTTN proposal for the benefit of potential investors and financiers as much as Telstra does."

However Samuel said that for both the Telstra FTTN and G9 proposals, no decisions could be made without full public scrutiny of a detailed proposal. And he stressed that there was no possibility of any negotiations or proposals bypassing the current regulatory regime: its rules and its processes.

"... when it comes to alleviating uncertainty or clarifying questions in the minds of competitors and investors by way of regulatory signals, the regulator can only do so much.

"I think the ACCC has demonstrated that it is happy to hold discussions with whoever wants to approach it and endeavours to progress issues swiftly. The Government has also endorsed the view that the existing legal processes in the Trade Practices Act can be used to ensure investment and regulatory certainty for carriers seeking to roll out fibre in the future, and that no changes to the legal regime should be necessary for Telstra or anyone else to implement the proposal."

Samuel expressed frustration with the lack of progress on FTTN saying. "I think our approach, and the government's position, have been communicated pretty clearly. However, as the months pass by since FTTN was first flagged as a genuine possibility, investors and competitors are no less in the dark about what they might expect.

" I was interested to note recent commentary suggesting regulatory uncertainty is actually good news for Telstra because it slows down competitive investment [in DSLAM infrastructure]."

He suggested that a detailed proposal from either Telstra or the G9 might alleviate "some of the doubt and uncertainty in the market....or at the very least, parties will be able to form their opinions."

Until then, "the G9's high level proposal might actually help to crystallise some questions about future competitive models, including whether we can have both FTTN and competition in Australia – goals which need not be mutually exclusive," Samuel suggested.