NBN Co defends Optus anti-sledge clause

The National Broadband Network Company (NBN Co) CEO Mike Quigley has defended an obligation put on Optus in its $800 million deal to not sledge the NBN in marketing for its wireless services, saying that it aims to protect Australian taxpayers.

As part of the agreement to move its hybrid-fibre coaxial (HFC) customers onto the NBN, Optus has agreed to "not make any disparaging statements about the NBN when promoting and marketing its wireless services to customers in the HFC serving areas". A similar clause in Telstra's $11 billion agreement with NBN Co has already concerned the Australian Competition and Consumer Commission (ACCC) that it could be anti-competitive.

According to NBN Co, the Optus clause is limited in scope only to prevent Optus from making critical or adverse statements about the NBN in marketing HFC areas. Quigley today defended the clauses in both deals.

"We don't view it as anti-competitive," Quigley said at the Australian Communications Consumer Action Network (ACCAN) conference in Sydney this morning. "The aim of these clauses in the agreement was to try and make sure that we at NBN Co protected the Australian public — the Australian taxpayer — who it is their money we are spending, to do these deals."

"We wanted to make sure that if we do a deal to have customers transferred, that we looked after the interest of the public to make sure we got traffic onto the network and there was nothing said with the people that we are doing a deal with that sledges the NBN," he added.

Quigley said he expected that competition on wireless will continue, with wireless and fixed line being complementary technologies, and the clauses were just about ensuring Telstra and Optus both represented the pros and cons of fibre technology fairly.

"Our responsibility at NBN Co is to make sure after paying these two organisations, we had fair and reasonable statements made about the NBN," he said.

Optus told ZDNet Australia in a statement that due to the limited nature of the clause, it would still be able to effectively market its wireless services.

"To the extent that there are further developments in wireless technology enabling the provision of faster wireless services to consumers, Optus will be free to offer those services to its customers. The wireless marketing provision will not act as a disincentive for Optus to invest in developing improved wireless technologies should it wish to do so."

In documentation accompanying the Optus and Telstra deals, NBN Co has admitted that the basic NBN package of 12 megabits per second (Mbps) downlink and 1Mbps uplink is possible on wireless broadband services, with the speeds often being considerably less due to the number of users in an individual cell.