ACCC accepts digital pay TV undertaking from Foxtel
The Australian Competition and Consumer Commission has accepted a special access undertaking from Foxtel for its digital Pay TV set top unit service.
The undertaking will permit independent providers of digital content channels – including interactive digital channels – to offer their channels directly to Foxtel customers through Foxtel's digital set top units.
"The ACCC congratulates Foxtel for its use of the special access undertaking provisions in the Trade Practices Act," ACCC Chairman, Mr Graeme Samuel, said today.
Foxtel is the first company to register a special access undertaking with the ACCC. The ACCC has also been involved in discussions with the G9 and Telstra about possible special access undertakings for fibre-to-the-node infrastructure.
The special access undertaking provisions began in 2003. They were added to Part XIC of the Trade Practices Act 1974 to allow companies to obtain regulatory certainty as to the terms and conditions of access they must provide on their telecommunications infrastructure.
"The ACCC is particularly pleased that Foxtel was willing to improve its original undertaking in response to representations from the ACCC and the public," Mr Samuel said.
Foxtel improved the terms and conditions of its offer after public consultation and resulting representations by the ACCC. Foxtel took steps to ensure the undertaking was consistent with the standard access obligations in the Act. Foxtel also provided better access to its electronic program guide, wrote contractual terms to apply more equally to Foxtel and access seekers, and revised access pricing.
Digital content providers using the undertaking will be able to offer their channels to Foxtel's customers as a tier to Foxtel's Basic Package. The ACCC noted that in May 2006, Foxtel reduced the number of channels in the Basic Package and reduced its price from $50.95 per month to $36.95 per month, increasing the ability of other content providers to compete for consumers' discretionary spending.
In a separate but related decision, the ACCC revoked its declaration of the analogue pay TV service, following public consultation.
On 31 January 2007, Foxtel completed the switching of its subscriber base over to digital set top units. Both Telstra and Optus have advised that their cable networks will be fully digital by May 2007.
While some smaller cable networks continue to use analogue technology, 90 per cent of Australian pay TV subscribers will be using digital cable or other technologies. As the regulation is no longer necessary to promote competition, it has been revoked.
"With these two decisions, the ACCC is pleased to note that in the Pay TV sector, access arrangements for both content and carriage are now entirely governed by access undertakings put forward by industry and developed through public consultation, rather than having to be imposed from outside by the ACCC," Mr Samuel said.
Copies of the two decisions will be available on the ACCC website.
The Analogue pay TV service was declared on 1 September 1999 in accordance with the Trade Practices Act 1974. The declared service provides for both distribution of content to Foxtel's customer base via analogue set-top units and access to carriage through analogue cable services from Telstra, Optus and other carriers.
Since that declaration, the majority of pay TV providers in Australia have transitioned their retail subscribers to digital pay TV services. Digital services enable consumers to receive an increased number of channel offerings and interactive services.
Foxtel commenced supplying its digital pay TV service on 14 March 2004.
Digital Pay TV services are not otherwise declared under Part XIC of the Trade Practices Act 1974, however third party access to Foxtel's distribution platform (its digital set top unit infrastructure) and to carriage via Telstra's digital cable network was (and remains) available under the Foxtel and Telstra s.87B undertakings provided to the ACCC in December 2003.
This special access undertaking from Foxtel now provides for improved access to the distribution channel to its customer base via its digital set top unit infrastructure and associated services (including inclusion in the electronic program guide, conditional access/ service information, and modems for interactivity). This undertaking enables content providers to better access Foxtel's distribution platform so that they can supply digital channels to Foxtel's subscribers.
