NBN given the thumbs up from ACCC as it predicts Foxtels monopoly ending
The Federal Governments National Broadband Network has been given a big thumbs up from Graham Samuel, the chairman of the ACCC, who also predicted Foxtel’s monopoly of Pay TV coming to an end and gave his endorsement on structural separation.
Samuel applauded the NBN, especially the regulatory changes that would come with its construction, as “the most momentous policy initiative” in telecommunications since deregulation, whilst speaking at the ATUG Regional Conference.
The failure so far by the Government to bring competition to the telecommunications industry was conceded by the chair of the Australian Competition and Consumer Commission, although the poorly executed privatization of Telstra by the Howard Government was were he placed the blame, during a wide ranging speech.
He said “The NBN project raises the opportunity to undo the mistakes made by previous governments that decided to leave Telstra in control of both the copper network and its retail operations. The ACCC considers these decisions to have been fundamental errors that have had very serious implications for the development of competition in the telecommunications industry.”
72 percent of all fixed-line retail voice subscription were currently controlled by Telstra, whilst only 11 percent of the market had been gained by its nearest rival Optus, Samuel said.
He said “Telstra has been permitted to compete in the same markets in which it provides access services over its fixed line copper network to other companies – granting it both the incentive and the ability to discriminate against access seekers in an anti-competitive way. The vertical integration of Telstra… has significantly constrained competition.”
Samuel also said that the imposing of operational and accounting regimes and other similar safeguards had been “ineffective in constraining Telstra’s incentives and ability to discriminate against access seekers.”
A roundabout endorsement to forcing structural separation on Telstra was given by the head of the competition watchdog in which he questioned whether it would be effective to opt for the softer ‘functional separation’ alternative.
He said “When successfully implemented, functional separation may go some way to addressing concerns regarding the promotion of equivalence in the treatment of access seekers. However, vertical integration of any form into downstream markets, even when subject to functional separation, will not necessarily ensure equivalence.”
Source – ITNews.com.au
