As telcos begin the battle for content supremacy, the commissioner of the Australian Competition and Consumer Commission (ACCC) has warned that companies like Apple and Google may eat them for breakfast.
Left to right: ACCC commissioner Ed Willett, Internode CTO John Lindsay and Communications Alliance CEO John Stanton.
(Credit: Luke Hopewell/ZDNet Australia)
ACCC commissioner Ed Willett today said that the consumer watchdog has its eye on content providers entering the local content war, using the National Broadband Network (NBN) as a springboard to compete with retail service providers (RSPs) for revenue and the all-important customer relationship.
"I think we're going to see a fight for the customer relationship, and we're going to see traditional retailers of telecommunications services coming under some challenge from players like the Googles and the Apples of the world, who also want to have the primary customer relationship," Willett said at a Communications Alliance event today.
To add insult to injury, Willett said that big content providers like Apple and Google would take advantage of the increased bandwidth offered by the new high-speed broadband environment to get more content to customers and muscle RSPs out of the game.
"It may be that we have the network service providers ... and the retailers coming under challenge from other players who simply use their services as a conduit to the customer, and become the primary source of customer relationship using those network services.
"That is going to be quite challenging to the traditional retail service providers, but it's also going to be a source of key competition," he added.
Willett's comments echo the thoughts of the telecommunications industry over the last 12 months. Optus' parent company SingTel has very recently restructured in response to the threat of online content and services giants.
Optus' Paul O'Sullivan told this year's Kickstart conference (PDF) that content giants like Google need to be closely monitored in the new broadband environment, to ensure that they don't lock down exclusive content to the detriment of industry competition.
"We have spent 15 years fighting to establish an open environment at the physical access layer, so we better all be vigilant to make sure that we don't win that battle only to lose it at the content and application level," O'Sullivan warned.
Other telcos and internet service providers (ISPs) are also doggedly guarding content-access rights, with Australia's second largest ISP, iiNet, recently expressing concerns to the ACCC over the merger between pay TV services Foxtel and Austar, saying that the deal would restrict competition in the emerging IPTV market.
The commission said that it wouldn't oppose the merger, so long as the newly joined entities don't chase exclusive content deals that would see smaller providers muscled out of the market.
Telstra has also reshuffled its business to drive content profitability. It consolidated all of its media assets into the one business arm.
Telstra's newly formed digital media business is investing around $100 million on new digital media transmission networks. The business unit also wants to serve customers content via their mobile phones, tablets, home-entertainment systems and online.