ACCC & AER annual report 2016-17

Analysis of performance: Telecommunications

Deliverable 3.1

Deliver network regulation that promotes competition in the long-term interests of end-users

Deliverable 3.2

Provide industry monitoring reports to government in relation to highly concentrated, newly deregulated or emerging markets

Deliverable 3.3

Improve the efficient operation of markets by enforcing industry specific competition and market rules

The ACCC’s work in the telecommunications sector contributes to all three of the deliverables for Strategy 3, as it encompasses regulation, monitoring and enforcement.

We are responsible for the economic regulation and monitoring of the communications sector. Our role is to provide effective telecommunications regulation that will protect, strengthen and supplement competitive market processes to improve the efficiency of the economy and increase the welfare of Australians.

Access regulation reduces barriers for competing operators that seek to enter and compete in downstream markets and invest in new infrastructure. As a result of regulating access to monopoly wholesale communications services, new entrants are often able to grow and innovate. Consumers then benefit in terms of both price and service quality.

In addition to the Competition and Consumer Act, we have responsibilities under the following Commonwealth legislation:

  • Broadcasting Services Act 1992
  • Copyright Act 1968
  • National Broadband Network Companies Act 2011
  • Radiocommunications Act 1992
  • Telecommunications (Consumer Protection Services Standards) Act 1999
  • Telecommunications Act 1997.

This year our priorities relating to telecommunications were:

  • undertaking access declaration and determination assessments for a range of telecommunications services, including non-NBN broadband services and a wholesale mobile roaming service
  • initiating an in-depth market study into current and emerging trends impacting competition and efficiency in the supply of telecommunications services
  • promoting Australian Consumer Law (ACL) compliance by NBN and retail service providers regarding broadband speeds
  • continuing to administer and monitor compliance with key aspects of the structural reforms of fixed-line telecommunications (including the Telstra structural separation undertaking).

Access to telecommunications networks and services

In regulating the telecommunications sector, we aim to establish reasonable access terms that:

  • balance the interests of infrastructure owners, users and the broader public
  • achieve any-to-any connectivity1
  • encourage efficient investment in, and use of, infrastructure
  • promote competition for the long-term benefit of consumers and businesses.

Declaration of telecommunications services

The telecommunications access regime contained in the Act supports the development of a competitive telecommunications industry by allowing services to be ‘declared’—a process that determines which services are regulated by the ACCC. Once declared, a service must be supplied, on request, to other providers.

The ACCC can declare a service by:

  • holding a public inquiry and allowing access providers, access seekers and consumers to comment
  • accepting a special access undertaking from the provider of a service that effectively declares a particular service.

There is another method for declaring a service, which applies only to NBN corporations (such as NBN Co). Where NBN Co supplies or intends to supply a service and publishes a standard form of access agreement for that service on its website, that service is declared.

Decision to declare superfast broadband access

The ACCC declared the wholesale superfast broadband access service (SBAS) on 29 July 2016. The SBAS allows retail service providers to access non-NBN superfast access networks to supply retail services to end users.2

Networks covered by the declaration include the fibre-to-the-basement (FTTB) networks operated by TPG subsidiary AAPT, and Telstra’s fibre networks in South Brisbane and Velocity estates.3 The SBAS does not include services that are, or soon will be, subject to other access regulations under Part XIC of the Act (for example, the NBN). It also excludes some services supplied exclusively to business, government and charity customers within the CBD of a capital city where competition appears effective.

The ACCC declared the SBAS because economic and potential technological barriers to entry mean that all superfast broadband networks are likely to display monopoly characteristics. The declaration also promotes regulatory consistency, allowing retailers to compete on their merits regardless of the technology used, when the underlying network was constructed or who operates it.

We expect that the declaration will facilitate entry and competition in superfast broadband retail markets and deliver long-term benefits to consumers.

Decision to declare wholesale asymmetric digital subscriber line

On 3 February 2017 the ACCC decided to continue declaration of the wholesale asymmetric digital subscriber line (ADSL) service for a further five years. We consider that continued declaration of the wholesale ADSL service on a national basis will promote the long-term interests of customers during the transition to the NBN. Continued regulated access to the service will lead to a more competitive retail sector, which is likely to deliver greater choices for end users, in the form of better prices. There was a broad level of industry support for the ACCC’s approach.

The wholesale ADSL service is a point-to-point service that enables retail service providers to deliver high-speed fixed-line broadband internet services to their customers, using another network provider’s equipment. The wholesale ADSL service was first declared in February 2012, and the current access determination will remain in place until it expires on 30 June 2019.

Draft decision not to declare wholesale domestic mobile roaming

The ACCC’s inquiry has explored whether the difference in geographic coverage between Australia’s mobile networks is leading to reduced competition or inefficient outcomes and whether declaring a domestic mobile roaming service would be in the long-term interests of end-users. Domestic mobile roaming allows consumers to access mobile services through another operator’s network when outside the coverage area of their own service provider’s network.

On 5 May 2017 the ACCC released a draft decision proposing not to declare a wholesale domestic mobile roaming service. The ACCC’s preliminary finding is that the national retail mobile market is currently exhibiting signs of reasonably effective competition. Given this, there is insufficient evidence to suggest that declaration of a mobile roaming service in regional and rural areas would further lower prices or improve services, given the higher costs in servicing these areas.

The ACCC received over 130 submissions to its October 2016 discussion paper on the issue with many submissions from regional groups concerned about coverage. The ACCC examined the incentives for mobile network operators to upgrade their networks or invest in expanding coverage both with and without declaration.

On 2 June 2017, Vodafone sought judicial review of the inquiry. The ACCC is proceeding with its inquiry and expects to make a final decision later in 2017.

Updated guidelines on declaration of telecommunications services

Under Part XIC of the Act, a carriage service, or service that facilitates the supply of a carriage service, can be declared. Once a service is declared, an access seeker can then obtain access to that service. There is no general right of access without declaration.

On 11 August 2016 the ACCC finalised a guideline for the Part XIC declaration provisions for telecommunications services. This guideline provides information about the processes for declaring a service, including an explanation of the differences between how an NBN service and non-NBN services can be declared. The guideline also outlines the key concepts we apply in considering whether to declare a service, including the long-term interests of end users test.

The guideline is an update to an earlier guide released in July 1999. It reflects changes to Part XIC that have altered the ways in which services can be declared, and provides discussion and more recent examples to illustrate how the ACCC will generally consider issues in deciding whether to declare a service.

Determinations of terms and conditions

Final prices for non-NBN high-speed internet services

The ACCC determined prices for the superfast broadband access service (SBAS) and the local bitstream access service (LBAS) on 26 May 2017. These are wholesale services provided on ’non-NBN‘ fixed line superfast broadband networks including those operated by Telstra (South Brisbane and Velocity estates fibre networks), TPG, Vocus, LBN Co, Opticomm, and OPENetworks.

The decisions specify the price and non-price terms for the supply of the SBAS and LBAS to retail service providers, in the absence of a commercial agreement. The final decision links LBAS and SBAS prices to NBN prices, while at the same time seeking to avoid setting prices below the reasonable costs for SBAS and LBAS providers. It also seeks to ensure that regulation is proportionate to the size of the non-NBN superfast broadband sector as a whole and networks within it.

The prices are expected to help drive better service performance for retail customers of superfast broadband providers as they will allow retail service providers to buy greater amounts of aggregation at a lower average price. The decisions run to 28 July 2021.

Court upholds ACCC prices for fixed-line services

On 28 March 2017 the Federal Court dismissed Telstra’s application for judicial review of the fixed-line services final access determinations (FADs) the ACCC made in October 2015. These FADs specified price and non-price terms of access to Telstra’s declared fixed-line telecommunications services for the period 1 November 2015 to 30 June 2019.

In making the FADs, the ACCC had made adjustments within its pricing model in recognition of the arrangements Telstra had entered into with NBN Co regarding migration of its customers to the NBN, the leasing of its fixed-line assets to NBN Co, and the corresponding payments Telstra would receive over the regulatory period.

Telstra had challenged the FADs on the grounds that, in making these adjustments, the ACCC had allegedly made various legal errors that meant that the FADs should be set aside by the Court.

In its judgment, the Court found that it was open to the ACCC to make the adjustments that it made, and that it had not made any reviewable errors. It concluded that Telstra’s grounds for review were impermissible attacks on the merits of the ACCC’s decision, and that the ACCC had demonstrated consideration of all the matters it is required to take into account when making FADs.

The 2015 FADs will continue until 30 June 2019. The Act requires us to commence an inquiry to replace these FADs 18 months before their expiry and ending six months before expiry.

Industry analysis, monitoring and reporting

Communications sector market study

In September 2016 the ACCC commenced a market study into the communications sector. The purpose of the market study is to ensure that the implications of developments in the communications sector are well understood, to identify issues that prevent relevant markets from delivering economically efficient and competitive outcomes in the interests of consumers, and to identify options, if required, to address these issues.

The key themes the ACCC is seeking to explore include:

  • the impact of changes in consumer trends and preferences on the provision of communications services
  • the growth in demand for data, largely driven by over-the-top (OTT) services such as Netflix, and the impact of this growth on network investment and data traffic management
  • industry consolidation, the transition to the NBN, and concerns about competition, pricing, and consumer expectations
  • the convergence of mobile and fixed-line networks
  • availability and competition in the supply of intermediate inputs, including internet interconnection, access to dark fibre, and domestic and international transmission
  • the emergence of new technologies and delivery platforms.

We received more than 1100 submissions by consumers, businesses and smaller service providers, and held a successful stakeholder forum in Sydney on 4 July 2017.

The views and insights from consultation and the stakeholder forum will assist in further refining the ACCC’s views. We expect to release the draft report in October 2017 and a final report in early 2018.

Annual reports on telecommunications competition

The ACCC’s annual telecommunications reports on prices and competition in the telecommunications sector were tabled in parliament and published on the ACCC website on 8 March 2017. Key findings of this year’s reports include:

  • consumer demand for streaming services, cloud services, and increasingly content-rich websites and social media applications is driving growth in data consumption
  • data downloads have increased 52 per cent for fixed broadband and 69 per cent for mobiles.

Accompanying this increase in data consumption, prices for telecommunications services have fallen overall by 1.5 per cent, while prices for internet services have increased by 2.7 per cent on average. This means that, while some consumers may be paying more, they are also getting much more in terms of data allowances.

Other findings include that competition is proving resilient to industry consolidation and the transition to new cost structures. Retail market shares have remained stable, while wholesale shares have moved as competitive carriers migrate services to the NBN and mobile virtual network operators swap over to other mobile networks.

Quarterly reports on the NBN wholesale market

The ACCC continued to release its quarterly reports on the NBN wholesale market. These reports provide a detailed view of the size and structure of emerging NBN wholesale access markets as NBN services become more widely available. The reports do not provide a view over the structure of emerging retail markets, however, as retail service providers can choose to acquire NBN access services or resell services offered by NBN access seekers.

Reports were issued on 29 July 2016, 2 November 2016, 2 February 2017 and 3 May 2017.

Review of record-keeping rules

In May and June 2017 the ACCC reviewed the ongoing need for the Telstra Exchange Facilities Record Keeping Rule (RKR), reaching the view that it should expire on 14 July. This RKR was originally implemented in 2008 following a number of complaints from access seekers concerning delays in obtaining access to Telstra exchanges.

The RKR required Telstra to report monthly on a number of metrics in relation to access to its exchanges, including the number of exchanges with queued access seekers and exchanges that are ‘capped’ (out of space).

After considering submissions from stakeholders and other developments, including the rollout of the NBN, the ACCC determined that this RKR was no longer necessary.

In June 2017 the ACCC commenced a public inquiry into whether the NBN Services in Operation RKR (and associated disclosure direction) should be extended, varied or allowed to expire. This RKR requires NBN Co to provide information on the number of wholesale access virtual circuit (AVC) services in operation, the amount of connectivity virtual circuit (CVC) capacity being acquired and average CVC utilisation over the NBN. The disclosure direction requires NBN Co to provide the ACCC with extracts from the NBN RKR for publication by the ACCC in the NBN Wholesale Market Indicators Report.

The ACCC sought views from interested parties as to whether additional information should be included in the NBN RKR and disclosure direction—specifically, whether expanded rules could include more detailed AVC and CVC reporting and whether reporting could be more frequent.

Quarterly reporting of access agreements

Carriers or carriage service providers (CSPs) who supply declared (regulated) services must lodge quarterly reports with the ACCC regarding all new, varied, cancelled and in-force access agreements in relation to declared services. These quarterly reports assist the ACCC in monitoring industry developments and fulfilling its responsibilities under Parts XIB and XIC of the Act.

During 2016–17, seven more parties provided reports on their access agreements than in the previous year. The increase is attributable to a review of non-reporting declared service suppliers conducted in 2015–16 and the ACCC decision to declare the superfast broadband access service in July 2016. The ACCC found that compliance was generally consistent with the requirements of the CCA. Where quarterly reports were not fully compliant, we worked constructively with carriers to resolve any deficiencies for future reporting.

Enforcement and compliance

ACCC to monitor Australia’s broadband performance

On 7 April 2017, the government announced funding for the ACCC to implement a fixed broadband performance monitoring and reporting program. This will involve the ACCC publishing information about the speed at which services typically operate, and other metrics relevant to measuring broadband performance and applications consumers commonly use. The ACCC expects to be able to provide its first report by the end of the 2017 calendar year.

The program will use hardware-based devices to perform remote testing of around 4000 households to determine typical speeds on NBN services at various points throughout the day, including busy periods.

As at 30 June the ACCC was in the process of appointing an independent third-party testing provider to measure and report to the ACCC on the broadband performance of various broadband services, technologies, speed plans and geographical areas. On 19 June 2017 we also called for volunteers to sign up for the program.

Guiding principles for advertising broadband speeds

On 10 February 2017 the ACCC published principles to help guide internet service providers marketing broadband speeds, including how to make a clear statement on the typical speeds consumers can expect during busy hours. These principles are:

  • consumers should be provided with accurate information about typical busy period speeds that the average consumer on a broadband plan can expect to receive
  • wholesale network speeds or theoretical speeds taken from technical specifications should not be advertised without reference to typical busy period speeds
  • information about the performance of promoted applications should be accurate and sufficiently prominent
  • factors known to affect service performance should be disclosed to consumers
  • performance information should be presented in a manner that is easily comparable by consumers, for example by adopting standard descriptive terms that can be readily understood and recognised
  • retail service providers should have systems in place to diagnose and resolve broadband speed issues.

We have undertaken targeted consultation with stakeholders on implementation of the principles and will publish further guidance later in the 2017 calendar year.

Investigations

We investigated 12 allegations of potential contraventions of the Act and of the Telecommunications Act specific to telecommunications markets.

These included complaints of misuse of market power under the telecommunications-specific anti-competitive conduct provisions in Part XIB of the Act. These complaints related to concerns that vertically integrated telecommunications providers refused to provide certain wholesale telecommunications services on appropriate terms, which it was alleged affected competition in downstream markets.

We also investigated allegations of non-compliance with the ‘level playing field’ provisions in parts 7 and 8 of the Telecommunications Act, which restrict owners of certain superfast telecommunications networks from using those networks to provide services directly to retail consumers. Additionally, we investigated allegations of misleading and deceptive conduct under the ACL.

The investigations were progressed and resolved consistent with the ACCC’s compliance and enforcement policy.

In March 2017 the Federal Court ordered the corporations trading as SoleNet and Sure Telecom (the SoleNet/Sure Telecom companies) and Mr James Harrison to pay penalties totalling $250 000 and be restrained from carrying on a business or supplying services in connection with telecommunications for a period of two years. The Court also disqualified Mr Harrison from managing corporations for three years, and ordered consumer refunds and payment of the ACCC’s costs.

These penalties followed a finding by the Court in December 2016 that the SoleNet/Sure Telecom companies had engaged in unconscionable conduct in connection with the supply of telecommunications services. This included customers being transferred from one SoleNet/Sure Telecom company to another without their knowledge or informed consent, and being subject to unjustified demands for payment of early termination or cancellation fees.

Contributing to structural reform

The telecommunications sector in Australia is continuing a period of structural reform, as provision of wholesale services transitions to the new NBN. Key pillars of this reform include:

  • NBN Co’s special access undertaking (SAU)—this is the key element of the regulatory framework that governs the price and non-price terms and conditions upon which NBN Co will supply its services to access seekers until 2040. The ACCC accepted NBN Co’s SAU in December 2013.
  • Telstra’s structural separation undertaking (SSU) and migration plan—together these outline how Telstra will progressively stop supplying telephone and broadband services over its networks and migrate those services to the NBN.
  • The ACCC has various roles as this transition occurs, including ensuring that the new monopoly NBN services are provided efficiently and support competition in retail markets, and that competition, efficiency and good outcomes for consumers are not compromised during the period of transition.

Assessment of variation of NBN Co’s access arrangements

The ACCC issued a draft decision to reject NBN Co’s proposed variation to its SAU on 28 March 2017. While the ACCC agreed with the overall approach that NBN Co had taken to incorporate its multi-technology mix (MTM)4 technologies into the SAU, we took the preliminary view that certain proposed changes would not promote the long-term interests of end users and were not reasonable. These included:

  • changes to service definitions that would allow future technologies introduced by NBN Co to be covered by the SAU without a further SAU variation
  • removing ‘Network Boundary Point’ from service definitions, which creates uncertainty for access seekers, especially in relation to maintenance responsibilities
  • locking in provisions relating to ‘co-existence’ and ‘remediation’ for fibre-to-the-node (FTTN) and FTTB services, which would allow NBN Co to provide services at lower data rates in certain circumstances for the remainder of the SAU term.

The ACCC considered that amendments to the proposals could be made to address its concerns. On 22 June 2017, NBN Co withdrew its proposed variation to the SAU and simultaneously lodged a revised version with the ACCC. Key revisions include:

  • re-instatement of the ‘network boundary point’ definition
  • removal of the term ‘any other telecommunications network’ from the definition of ‘NBN Co Network’, and
  • refinement of the ‘co-existence’ and ‘remediation’ clauses and limiting the period in which the provisions apply to Module 1 of the SAU.

The ACCC published the revised variation on 27 June 2017 and invited submissions from interested parties by 4 August 2017.

Determination on NBN revenue controls

Under the NBN Co SAU, the ACCC must make annual determinations specifying the amount of revenue that NBN Co is allowed to earn for each financial year. On 23 June 2017, the ACCC issued its final determination report accepting NBN Co’s submission on its revenue controls for 2015–16.

Improvements to customer migration

On 20 July 2016 the ACCC approved a variation to Telstra’s migration plan. The variation reflects improvements resulting from Telstra’s and NBN Co’s experience to date in migrating end users to the MTM NBN.5 These changes provide greater assurance and certainty to end users that they will not prematurely lose their voice and broadband services before migrating to the NBN. The changes will also give retail service providers more time to complete their migration activities, to promote a more seamless experience for customers as they move to the NBN.

Telstra’s involvement in the NBN rollout

In September 2016 the ACCC released a report on the competition implications of Telstra’s involvement in the rollout of the NBN. Under service delivery agreements between NBN Co and Telstra, Telstra will supply network activation and assurance services, and network planning, design, construction, and construction management services.

As set out in the report, the ACCC raised concerns that the agreements may give Telstra a ‘head start’ in connecting customers to NBN hybrid-fibre coaxial (HFC) broadband services, preferential service activation and/or repair of NBN broadband services for its own customers, and greater insight than its competitors into the NBN rollout. NBN Co and Telstra had also agreed a number of measures to mitigate the potential risks to competition.

Telstra subsequently commenced reporting to the ACCC each quarter on the number of new HFC connections. This provides visibility as to whether out-of-the-ordinary demand for Telstra HFC services is emerging in areas subject to HFC works. NBN Co has also commenced reporting each quarter to NBN access seekers on operational outcomes where Telstra is the service delivery partner.

NBN Co also advised the ACCC that it is supplementing its rollout reporting to access seekers to provide additional guidance on NBN construction progress in rollout areas subject to the NBN Co–Telstra HFC delivery agreement. As a result of this measure, all of the reporting measures recommended by the ACCC in its assessment of the NBN Co–Telstra service delivery agreements will have been implemented.

The ACCC continues to work with NBN Co and Telstra to establish suitable arrangements for monitoring the implementation of the agreements.

Telstra’s compliance with structural separation undertaking

The ACCC must monitor and report to the Minister for Communications and the Arts each financial year on Telstra’s compliance with its structural separation undertaking (SSU) obligations. The report, tabled on 27 April 2017, is part of the structural reform of the telecommunications industry.

The latest report shows that there has been a reduction in the number of breaches reported by Telstra during the year. The most common SSU compliance issue continues to be Telstra’s failure to prevent the unauthorised disclosure of wholesale customer’s confidential or commercially sensitive information. These breaches arise from incidents of inadvertent disclosure.

The ACCC also identified two additional breaches of Telstra’s price equivalence and transparency obligations, relating to delays by Telstra in updating its rate card after the ACCC fixed-line services and domestic transmission capacity service determinations. Telstra disputes that these instances are breaches of the SSU.

Telstra generally complied with its migration plan obligations during the reporting period. Telstra reported minor breaches related to scheduled disconnections that did not occur within the required timeframes; delays in the notification of disconnection schedules; copper services being supplied to previously disconnected premises; and the connection of services that were not permitted under the ‘cease sale’ obligations or within the order stability period.

Review of Telstra’s information security remediation

On 4 October 2016 the ACCC announced Telstra’s completion of an information security remediation program, concluding a long-running project to achieve compliance with its SSU.

Following commencement of the SSU in 2012, Telstra reported a series of information security issues. These issues related to commitments to prevent the disclosure of sensitive wholesale customer information to Telstra’s retail businesses. The issues largely arose from Telstra’s legacy IT systems not being designed to deliver the outcomes required under the SSU. To meet its obligations, Telstra subsequently undertook a lengthy and complex program of remediation.

As part of this process, the ACCC engaged an independent expert consultant, Ovum, to conduct a thorough review of the remediation project. This led to Telstra conducting a further due diligence review of its remediation project that adopted a more rigorous approach to testing IT systems and identified a small number of additional issues to be remediated.

Participation in industry working groups

The ACCC is an observer or participant on a number of industry working groups set up to address practical issues that arise as part of the industry reform. These groups include the quarterly NBN Fire Alarm and Lift Phone Roundtable meetings convened by the Department of Communications and the Arts. The roundtable comprises stakeholders from the fire alarm industry, the elevator industry, NBN Co and the telecommunications industry.

During 2016–17 we also attended NBN Co’s public information on migration briefings as an observer. NBN Co is responsible for funding an information and education campaign to inform consumers about the migration of copper services to the NBN.

We have also taken part in the Service Continuity Assurance Working Group, which includes NBN Co, Telstra, Optus, Communications Alliance and relevant government agencies. The purpose of the working group is to help resolve issues that may affect people’s ability to rely on their telephones and internet as services are disconnected from Telstra’s legacy networks and migrated to the NBN.

The ACCC is also an observer on the following Communications Alliance working groups set up to consider migration issues:

  • Copper Migration Working Committee, which considers the roles of different stakeholders involved in the migration of consumers to the NBN
  • NBN Over-the-top Services Transition Working Group, which considers the migration of services that operate over legacy networks, such as monitored medical alarms, monitored fire alarms and monitored lift phones
  • NBN FTTN/B and HFC Migration Processes Working Committee, which considers the processes to follow in migrating a service onto the NBN FTTN/B and HFC networks
  • NBN Fibre Access Transfer Working Committee, which considers the processes to follow in transferring an active NBN service between retail service providers.

During the year, these working groups finalised an industry code for transferring NBN services between retail service providers and further developed the industry guideline for NBN migration processes with a view to incorporating further NBN technologies.

Assistance and collaboration with other government agencies

We have contributed to, or been asked by government to provide advice or assistance on, a range of projects affecting regulation of telecommunications. In our contributions we seek to promote competitive outcomes, including the efficient use of infrastructure and the long-term interests of consumers.

Support for greater access to data

The ACCC provided a submission to the inquiry by the Productivity Commission (PC) on data availability and use. The PC’s final report was tabled in parliament on 8 May and made wide-ranging recommendations on changes to how data should be used across the economy, with a strong emphasis on the benefits to competition and consumers from these reforms. The PC’s proposals include the introduction of a new right that would allow consumers to direct service providers to supply data about the consumer to a nominated third party, such as a comparison website or alternative service provider.

The ACCC provided a high-level submission to the PC’s draft report in January 2017. Our submission expressed support for the data transferability proposal and a role proposed for the ACCC. We noted the potential for the PC’s recommendations to support greater competition between service providers and better outcomes for consumers.

Advice on allocation limits for unsold 700 MHz spectrum

Following a request from the Minister for Communications and the Arts on 5 October 2016, the ACCC provided advice on the appropriate allocation limits for an auction of two 15 MHz parcels of unsold 700 MHz digital dividend spectrum.

We recommended that the Minister impose an allocation limit on the unsold 700 MHz auction such that no person or specified group of persons would be able to hold more than two 20 MHz parcels in the 700 MHz band as a result of the auction.

Allocation limits are an important tool to ensure that competition considerations are taken into account in spectrum auctions. In this case, allocation limits are necessary to prevent the monopolisation of the spectrum and to help ensure that the results of the auction are in the long-term interests of end users.

The auction of the unsold 700 MHz spectrum occurred in April 2017, with the ACCC’s recommended allocation limits imposed.

New MoU with Australian Communications and Media Authority

The ACCC and the Australian Communications and Media Authority signed a revised memorandum of understanding (MoU) on 15 December 2016. The MoU sets out a framework for engagement and consultation between the agencies, with key guiding principles. The document was developed with a view to reinvigorating consultation between the two agencies and demonstrates the agencies’ commitment to effective engagement and the benefits of collaboration. It replaces an MoU from 1999.

1 Any-to-any connectivity refers to the principle that a person using a telephone service should be able to communicate with another person on a similar telephone service irrespective of the network each person is using.

2 Superfast access networks refers to access networks that provide a downstream data rate normally above 25 megabits per second (Mbps).

3 Telstra Velocity estates are housing estates served by a fibre access network operated by Telstra.

4 Multi-technology mix (MTM) refers to the fibre-to-the-node, fibre-to-the-basement and hybrid-fibre coaxial access networks used by NBN Co.

5 Multi-technology mix (MTM) refers to the fibre-to-the-node, fibre-to-the-basement and hybrid-fibre coaxial access networks used by NBN Co.