The Australian Competition and Consumer Commission today issued a discussion paper seeking comment on whether Internet interconnection arrangements should be regulated under the Trade Practices Act 1974.
Internet interconnection allows customers - business, residential or others - that are connected to one Internet network to send and receive emails and access websites connected to other Internet networks. Internet interconnection also enables business and other consumers to have the content they store on the Internet able to be accessed by other Internet users.
If the ACCC decides to regulate Internet interconnection an ISP would have to provide access to the relevant parts of its network to rival ISPs and the ACCC would have power to arbitrate the terms and conditions for access in the event of a dispute.
ACCC Commissioner for telecommunications, Mr Ross Jones, said the ACCC is particularly interested in determining how Internet interconnection arrangements affect end-users and suppliers of telecommunications services.
"At the moment there appear to be some anomalies", he said. "For example, if I am connected to a smaller ISP and I send an e-mail to my friend at one of the four larger ISPs, the larger ISP may charge my smaller ISP for sending the e-mail. However, when my friend at the larger ISP sends me a return email, my smaller ISP will have to pay the larger ISP once again.
"The ACCC is concerned to ensure that the terms and conditions for interconnection between domestic ISPs are competitive. This should result in lower prices for broadband and dial-up Internet services, and a greater range of innovative service offerings for consumers.
"Whether regulation of Internet interconnection would lead to these benefits for consumers is a key consideration of this inquiry".
The Minister for Communications, Information Technology and the Arts, Senator Richard Alston, shares similar concerns about current Internet interconnection arrangements and has asked the ACCC to recommend how the matter should be addressed.
Mr Jones said a number of complex issues have already been identified and the ACCC is seeking as much input from interested parties as possible.
"Any regulation of Internet interconnection services would need to have consideration of the legitimate business interests of all ISPs providing Internet services, especially those of the major network providers who have invested heavily in rolling out Internet backbone networks.
"The ACCC is also aware that substantial investment in telecommunications infrastructure by both Telstra and other industry suppliers is required to provide Internet interconnection services".
Interested parties have until 20 June 2003 to make submissions addressing the issues. After considering these submissions, and conducting the public consultation process, the ACCC aims to issue a draft report in September 2003 before finalising its inquiry later in 2003.