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BROADBAND TO WHERE?. KEY CONCEPTS AND ISSUES. 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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Broadband to where

BROADBAND TO WHERE?

KEY CONCEPTS AND ISSUES


Broadband to where1

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


Telecommunications key concepts

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


Telelcommunications key concepts

TELELCOMMUNICATIONS: KEY CONCEPTS

Carriers - What are they

owner(s) of network units used to supply carriage servicesto thepublic 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


Telelcommunications key concepts1

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 B’casting service, on-line information or entertainment service, any other on-line service by Min. Determination


Telelcommunications key concepts2

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


Telelcommunications key concepts3

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


Part xic the access regime

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


Part xic the access regime cont d

Part XIC: The Access Regime (cont’d)

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


Part xic the access regime cont d1

Part XIC: The Access Regime (cont’d)

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 C’wealth [2008] HCA 7

Declaration of ULLS and LSS do not amount to acquisition of property by the C’wealth without just compensation (When Telstra acquired from C’wealth, it did so subject to competition rules)


Existing interconnection arrangments

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


Fanoc terria proposal fibre access network ownership corp

FANOC/TERRIA (?) PROPOSAL(Fibre Access Network Ownership Corp)

Telstra and Competitors

FANOC ROUTER

Proposed network

Pillar

LEX - Local

Access Point

Home

Node

DSLAMS

CAN

Service Aggregation Network (SAN)


Fanoc proposal

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


Telstra proposal

TELSTRA PROPOSAL??

Telstra

Telstra

LEX

Home

Pillar

Node

Competitors

Customer Access Network


Government policies on broadband

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.


Operational structural separation

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.


Operational separation a history

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


Issues

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?