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Sims outlines Oz network regulation again

Calming the debate

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As the ACCC, under the hand of new chair Rod Sims, settles down to the work of sifting through submissions about NBN wholesale access, there’s probably a sense of relief at the welcome distraction provided by the Economist Intelligence Unit.

Normally, having the new chair of the ACCC discuss the NBN in a speech – as he did on October 10th to the Melbourne Press Club – would give rise to all manner of expert “reading between the lines” to interpret what he said.

But the EIU, by restating its opposition to the NBN in the press release for its six-monthly broadband report, was the attention-grabber of the day, especially when opposition communications spokesman Malcolm Turnbull seized on the EIU’s boilerplate to liken the National Broadband Network to Cuba.

So Sims’ statements were largely passed over.

The full speech is here as a PDF, with his comments on the telecommunications sector beginning on page 8.

What’s interesting in Sims’ statements is not that he identifies the live issues in the NBN rollout – but how apparently mild his statements are.

Let’s compare what he said about airports, Internet search and the grocery business to what he said about the NBN:

Airports – “There is considerable concern that the major airports operate as monopolists in their markets … the ACCC agrees.”

Search – “The ACCC did not win in the Federal Court, but there is no question that the law in this rapidly expanding area of commerce needs clarification.”

Supermarkets – “The ACCC can and will watch closely to ensure any such dealings [between supermarkets and suppliers] do not involve unconscionable conduct.”

The NBN – “We intend to engage constructively with NBN, its access seekers and consumers as we settle the regulatory arrangements for the NBN.”

Even his strongest statement about telecommunications – that the market needs a “robust regulatory regime” covering both pricing and network access – seems comparatively sanguine.

And, unlike the EIU, which considers the NBN to be a destroyer of all competition – you can read the AAP treatment here, if you think it’s worth your time – the ACCC has a more measured and accurate description of the network.

“The extensive fibre-to-the-premises infrastructure will be a fixed-line [monopoly] for the supply of input services to telecommunications companies, who in turn provide voice and broadband services to consumers,” he said (our emphasis, and our substitution of “monology” with “monopoly” to fix what looks like a transcription error).

It seems that Sims – and by extension, the ACCC, since his advice is coming from experts within the Commission – believes that the right access arrangements can preserve competition for consumers, and even lead to “continuing reductions in prices”. ®

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