BROADBAND TO WHERE

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BROADBAND TO WHERE?

• KEY CONCEPTS AND ISSUES

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BROADBAND TO WHERE

• WHO CAN INSTALL TELCO INFRASTRUCTURE (THE NBN) -
  KEY CONCEPTS
• Communications carriage
• Carriers
• Carriage Service Providers
• Access/competition rules
• AN NBN - THREE MODELS
• OPERATIONAL/STRUCTURAL SEPARATION
• THE ISSUES

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TELECOMMUNICATIONS KEY CONCEPTS

• Carriage - the use of electromagnetic energy to
  deliver communications at a distance
• Regulation of carriage
• Telecommunications Act
• S. 12 - The Act has effect subject to the
  Radiocommunications Act 1992 (but the fact that a
  person is authorised to do something under the RA
  does not mean they are authorised under TA)
• Radiocommunications Act 1992 - Part 3.1 -
  essentially a prohibition on the operation of an
  unlicensed radiocommunications device except in
  exceptional circumstances.
• NB If a person has been allocated a broadcasting
  service band licence under the BSA, they must be
  allocated a transmitter licence (apparatus
  licence) under the RA

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TELELCOMMUNICATIONS KEY CONCEPTS

• Carriers - What are they
• owner(s) of network units used to supply carriage
  services to the public must obtain a carrier
  licence (s. 42)
• network Units - link links connecting distinct
  places over a statutory distance (500 metres)
• carriage services - services for carrying
  communications by means of guided and/or unguided
  electromagnetic energy
• supply to the public - if unit used for carriage
  of communications between two end users where at
  least one end user is outside immediate circle of
  owner of network unit
• NB Under Schedule 3, TA, carriers are given
  powers and immunities to install infrastructure

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TELELCOMMUNICATIONS KEY CONCEPTS

• SERVICE PROVIDERS (S. 86)
• Includes Carriage and Content Service Providers
• Carriage Service Providers (s. 87)
• If person supplies a listed carriage service to
  the public using network units.
• Listed carriage service (s. 16)
• Carriage service between point in Aust and
  another point in Aust or point outside Aust
• Supply to the public (s. 88 - as before)
• Content Service Providers (s. 97(2)
• If person uses/proposes to use listed carriage
  service to supply a content service to the public
  - is a listed content provider.
• Content service (s. 15) is Bcasting service,
  on-line information or entertainment service, any
  other on-line service by Min. Determination

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TELELCOMMUNICATIONS KEY CONCEPTS

• Competition in Infrastructure Provision
• Schedule 1, TA Carriers must give other
  carriers
• Access to facilities (Towers, Ducts etc) (by
  agreement or ACCC arbitration)
• Access to Network Information

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TELELCOMMUNICATIONS KEY CONCEPTS

• Competition in Service Provision
• Government Policy - s. 3 Objects of TA
• Framework that promotes the LTIE, and
• Efficiency and international competitiveness of
  the telecommunications industry
• TPA - Part XIB/XIC
• Part XIB - Anti-competitive conduct
• The Competition Rule/Competition Notice
• Information Provision - RKRs
• Operational Separation on Telstra
• Part XIC - The Access Regime

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Part XIC The Access Regime

• Definitions
• Access - to listed carriage services
• Access Seekers - requested access to a declared
  listed carriage service
• Access Providers
• Carriage services
• Declared services/active declared services
• Declaration of Service
• Deemed to be declared
• On the recommendation of the TAF
• After a public inquiry - initiated by the ACCC or
  an individual

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Part XIC The Access Regime (contd)

• Service Declaration
• What can be declared Listed carriage service, or
  a service that facilitates the supply of a listed
  carriage service (concept of unbundling)
• Once a Service is declared
• Service is subject to Standard Access
  Obligations,
• with recourse to the ACCC if agreement cannot be
  reached
• expiry date must be specified (must occur within
  5 years, but can be extended)
• must be public enquiry on service declaration
  within 12 months of expiry date

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Part XIC The Access Regime (contd)

• Standard Access Obligations
• Must supply service
• Must provide interconnection
• Must supply service on equivalent terms and
  conditions to what provided to self - technical,
  operational quality, fault detection, handling
  rectification
• Provision of billing, including timing and
  content
• Access to conditional access customer equipment
• Telstra v The Cwealth 2008 HCA 7
• Declaration of ULLS and LSS do not amount to
  acquisition of property by the Cwealth without
  just compensation (When Telstra acquired from
  Cwealth, it did so subject to competition rules)

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EXISTING INTERCONNECTION ARRANGMENTS
PSTN
DECLARED SERVICES - ULLS OR LSS
Telstra
DSLAMs
Competitors
home
LEX
pillar
Customer Access Network (CAN) - broadband service
delivered through the digital subscriber line
access multiplexors (DSLAMs) in the LEX. The CAN
- the twisted cooper pair - LEX to home - owned
(almost totally) by Telstra as the bottleneck
facility
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FANOC/TERRIA (?) PROPOSAL(Fibre Access Network
Ownership Corp)

• Proposed network

Telstra and Competitors
FANOC ROUTER
Pillar
LEX - Local Access Point
Home
Node DSLAMS
CAN
Service Aggregation Network (SAN)
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FANOC Proposal

• Elements
• Roll out of broadband - initially at ADSL2
  speeds transitioning up
• Investment in FANOC open to access seekers -
  wholesale purchasers of the BAS
• Operation and management of the network (SAN) by
  SpeedReach (BAS Manager)
• Requirement of pillar migration
• New class of licence for construction of HFTP
  network
• Extended term for its special access undertaking
  - 15 years
• Amendements so can acquire 100 access to CAN

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TELSTRA PROPOSAL??
Telstra
Telstra LEX

Home
Pillar
Node
Competitors
Customer Access Network
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Government Policies on Broadband

• FTTN to 98 of population, using 4.7 billion
  public funding
• Other 2 of population to receive higher speed??
• Competitive assessment of private sector
  proposals, including regulatory reforms
• Proposals to address
• Equivalence of access charges
• Full scope for access seekers to differentiate
  their product offerings by allowing the
  customisation of access speeds, quality of
  services and contention ratios.
• Regulated access prices would be set at a level
  that ensures a commercial return can be made on
  such an investment.

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OPERATIONAL/STRUCTURAL SEPARATION

• Operational Separation
• retaining the corporate structure, but removing
  the incentive for the wholesale/infrastructure
  arms of a company favouring the retail area of
  the company over retail rivals. The aims of
  operational separation are for the
  wholesale/infrastructure area to
• provide equivalence in price, product, quality,
  terms and conditions, and it usually involves
  separation of the infrastructure/wholesale areas
  physically and corporately (up to Board level)
  using different staff, separate data bases,
  different KPIs for staff, etc.
• Structural Separation
• The separation of the retail operations from the
  wholesale/ infrastructure areas into separate
  legal entities.

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OPERATIONAL SEPARATIONA History

• 1993 Hilmer Report - GBE Reform including
  structural separation inquiry before
  privatisation of Government owned monopolies
• 2000 Regulatory Accounting Framework
• 2002 Accounting Separation
• 2005 Operational Separation - into
• Retail, wholesale and infrastructure entities
• Equivalence principle
• Monitoring and reporting regime

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ISSUES

• Establishment of a monopoly provider (whether
  Telstra or FANOC/Terria) - FANOC/Terria proposes
  allocation for licences to construct the hybrid
  fibre/twisted pair network (HFTP) or AXIA model -
  wholesale provider only
• Reliance by FANOC/Terria on Telstra cooperation
  and use of the (smaller) CAN - query what AXIA
  will do
• Stranded investment?
• Operation and management of the network (SAN) by
  SpeedReach (BAS Manager) or equivalent
• Requirement of pillar migration
• Will the CAN still a bottleneck
• Will there need to be a stronger
  operational/separation regime on Telstra
• How much bandwidth is needed - and is the public
  prepared to pay the price?

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• THANK YOU