The ACCC is considering whether to ‘declare’ wholesale ADSL because of concerns that  as the NBN is rolled out, Telstra could move to restrict competition.

 

The ACCC can declare a service if it is satisfied that doing so would promote the long-term interests of end-users of carriage services, or of services supplied by means of carriage services.

 

Submissions to the ACCC’s inquiry into wholesale ADSL service declaration show that rival providers are concerned that Telstra’s terms and conditions of supply inhibit competition.

 

TPG Telecom Limited argues that “Telstra has repeatedly obtained advantage for itself over competitors like TPG both by pricing its wholesale services at a rate that made it extremely difficult for competitors to compete and by creating unnecessary business constraints around the supply of the service.

 

Likewise, Optus states,  Telstra has “repeatedly used its substantial market power to hinder competition in this space and specifically to discriminate against infrastructure based competitors,” and called for the ACC to “move quickly to implement pro-competitive cost-based pricing of the wholesale DSL service.”

 

AAPT considers that the declaration of a W-ADSL broadband access service should only apply to Telstra and not other potential providers as this would act to discourage rather than promote competition.

 

AAPT notes that “As the vertically integrated incumbent service provider, Telstra is the only service provider with a strong incentive and the ability to: create additional barriers to entry for new entrants; and discriminate against wholesale customers in favour of its own retail business unit, in order to firm up and expand its fixed line customer base and migrate them over to the NBN.”

 

Telstra defends its position, arguing that declaration of wholesale ADSL is unwarranted and “would neither promote competition nor encourage efficient investment in infrastructure, and would not be in the long term interests of end users”.

 

Information about and submissions to the inquiry are available here.