Turnbull slams ACCC approval of Optus and NBN Co agreement
- 20 July, 2012 12:40
- Comments 3
Malcolm Turnbull has slammed the recent ACCC approval of an $800 million agreement with Optus and NBN Co which will see Optus decommission its HFC network and aid the migration of Optus customers to the National Broadband Network (NBN).
Turnbull, shadow minister for communications and broadband, attacked the agreement as anti-competitive and creating a monopoly.
“This is a very black day for the ACCC. This agency [was] established to promote and protect competition. For years, decades, it has railed against Telstra and its quasi-monopoly status in telecommunications and has called, again and again, for more competition,” he said in a statement.
“…nowhere else in the world has a government established a new fixed line monopoly and actually paid billions [of] dollars to the owners of the HFC networks not to provide broadband and voice. It is the very pinnacle of anti-competitive behaviour,” he said.
While the ACCC stated the agreement’s benefits outweigh the detriments, Turnbull asserted the Optus and NBN Co deal should have been blocked by the ACCC.
“The reasons given by the ACCC [for its approval] are confused and contradictory,” he said.
The Coalition has previously put forward suggestions it would develop the NBN by building on existing networks, which could include HFC, instead of developing a fibre-to-the-home network.
“…if you are going to get the crystal ball out, isn’t there just a teensy weensy possibility there of a change of government which will take a very different approach to the NBN?” Turnbull said.
Turnbull also questioned the use of $800 million of taxpayer funds for the agreement, stating Optus has “hit the jackpot”.
“…NBN Co are not lunatics who shell out $800 million for nothing as the ACCC suggest. On the contrary, the HFC is an extremely viable competitor with the NBN Co and because its original capital cost was written off long ago, Optus could upgrade it for a modest cost which would enable it to undercut the NBN on price and provide equivalent services for most customers.
“Recognising this the government and the NBN Co decided to use our taxes to buy out this competition just as they have done with Telstra’s HFC.”
However, independent telco analyst, Paul Budde, previously told Computerworld Australia that the Optus and NBN Co deal makes sense because the NBN is a utility and Optus long ago abandoned upgrades to its HFC network, with subscribers on the network remaining largely unchanged for the past decade.
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Comments
Francis Young
1
Yet again, Malcolm Turnbull creates a smoke screen by equating the unproductive duplication of infrastructure with the retail competition we see in the NBN, and which serves the customer and innovation. By contrast, facility competition causes wasteful duplication and adds cost to customers. Already, at least 43 retail providers are selling regional services over our public NBN assets, after fifteen years of being stymied by Telstra's corporate monopoly.
Telstra's share price is now 46% higher than its twelve month low of $2.69, and heading inexorably upwards, as I predicted when MT portrayed the NBN deal as as attack on Telstra.
Australians are sick and tired of the cost and delay the coalition is causing, and the ACCC is absolutely correct that allowing Optus to receive an admin fee for each customer it migrates from its near-end-of-life HFC onto NBN fibre is a perfectly sensible solution to offset any lost revenue to Optus from retaining them on HFC, and allows Optus to stop maintaining that ageing coax.. It also resembles the agreement with Telstra for its HFC customers.
As part of the public program to expedite universal broadband, the Optus agreement approved by the ACCC expedites the monthly wholesale revenue from the customer to more quickly repay the NBN construction cost. It avoids any litigation or admin delay from ISPs in getting a fibre service delivered to the ex-HFC customer. It ensures that the rollout in each area gets to every premises from day one, instead of requiring costly one-off installations later.
Every alternative technology argument Mr Turnbull has uttered against the NBN has been soundly proven wrong in Computerworld pages and elsewhere. Wireless, FTTN and HFC are neither cheaper nor better solutions than fibre for anyone in the 93% urban footprint, nor would they be completed sooner than fibre.
In 2010, the coalition lost an unloseable election over broadband, handing power to a Green-Independent-Labor minority government. In 2013, with many regional voters using NBN services, it will be quite impossible for the coalition to win most regional seats over independent candidates unless it adopts the NBN. Coalition supporters are already withholding campaign contributions citing the party as destined for electoral oblivion, despite Labor again being unpopular.
The coalition will win easily in 2013 if they adopt Labor's only popular policy, the NBN. Not that Malcolm Turnbull cares.
Paul
2
I dont beleive the libreals will have any choice in the matter now. The linchpin of their policy has just been contracted away....HFC.
Where can they go from there? Cant upgrade a decommissioned HFC network thats being pulled down as xPON passes its footprint.
Leaves very very little wiggle room for alternative policy...wireless and fttn (? not really viable considering bandwidth requirements will exceed the performance by the time its completed....it would need to be upgraded to fully deep fibre in 10 years anyway).
Malcom may be singing a different tune privately...this is the last straw he may have needed to apply pressure internally to adopt the NBN policy, and actually win them the election.
Francis Young
3
I hope you're right, Cerberus. If so, the three-headed beast that is the coalition broadband mouthpiece needs to start talking up the FTTP solution quickly, or voters will simply not believe the coalition policy has changed from just giving stagnant more-of-the-same support to corporate boardrooms to deliver whatever suits them.