Nine regulated telecommunications services, mostly operating over Telstra’s legacy network, are to be reviewed by the ACCC to determine whether they require continued oversight in this way.
Services that the ACCC regulates are known as ‘declared’ services. The commission has the power to set price and non-price terms for access. The prices act as a ceiling for what the infrastructure owner can charge.
The regulated services are used in the supply of “voice calls, the resale of analogue fixed line phone services, data transmission, and ADSL resale,” the ACCC said.
The commission broadly wants to know whether the services still need to be regulated, given that most consumer-grade telecommunications and broadband services now run over the NBN or other infrastructure.
On the data transmission side, while the ACCC noted there is considerable competition in metropolitan areas and over intercapital routes, it said that Telstra still had an advantage in regional Australia, which could pose a risk in unwinding regulation there.
“Investment has been marginal in regional areas outside the eastern seaboard, except some fibre extensions to provide connectivity to small communities in far-north Queensland and the Northern Territory,” the commission noted in a discussion paper.
“In many regional and remote areas, Telstra continues to be the sole operator of transmission networks, many of which are located hundreds of kilometres away from the closest alternative infrastructure.
“This means that, absent regulation, Telstra continues to have the ability to set terms of access in large parts of the network and, as a vertically integrated operator, could have incentives to restrict the supply of transmission services to its competitors.
“A monopolistic transmission market in some regional areas may also hinder efficient investment in infrastructure supporting services in downstream markets. For example, a mobile network operator may not choose to provide mobile voice and broadband services in a remote location if transmission is not available or the terms offered effectively hinder access.
“In these circumstances, extending the declaration, together with cost-reflective price terms for access to transmission, will likely reduce hurdles to further investment in the infrastructure supporting services in related markets.”
The ACCC said it would also consider “the impact of newer technologies such as instant messaging and video conferencing apps on relevant telecommunications services, and what it means for regulation” as part of its inquiry.
The ACCC is accepting industry submissions until July 12.
