ACCC tightens Internet interconnection monitoring

The Australian Competition and Consumer Commission (ACCC) has issued a draft report proposing that Internet interconnection arrangements should be subject to a two-year period of monitoring.The ACCC is pushing for the monitoring proposal in order to deal with "anomalies" observed within the system.

The Australian Competition and Consumer Commission (ACCC) has issued a draft report proposing that Internet interconnection arrangements should be subject to a two-year period of monitoring.

The ACCC is pushing for the monitoring proposal in order to deal with "anomalies" observed within the system.

Internet interconnection allows customers -- business, residential or others -- that are connected to one Internet network to send and receive e-mails and access Web sites connected to other Internet networks.

Internet interconnection also enables business and other consumers to have the content they store on the Internet accessed by other Internet users.

ACCC commissioner for telecommunications, Ed Willett, said the ACCC wanted to know how Internet interconnection arrangements affect end-users and suppliers of telecommunications services.

"At the moment there appear to be some anomalies. 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," Willett said.

The ACCC has conducted an inquiry into whether to regulate Internet interconnection. The ACCC's draft decision has determined that a case has not been made out for regulation at this stage, but that "there are sufficient concerns to warrant the implementation of a rigorous monitoring program".

Willett added that the ACCC has attempted to determine whether the terms and conditions for interconnection between domestic ISPs are competitive. However, the inquiry has been hampered by "the unavailability from most industry players, including some of those advocating regulation, of crucial information relating to traffic flows, costs, and network capacities".

"The ACCC has gone to considerable lengths to obtain this information, but most industry players appear either not to collect it in the first place, or not to keep it in an appropriate form," he said.

Willett added that the inquiry had indicated the potential for the industry to be "adversely affected by anti-competitive interconnection arrangements." Because of this, Willett said, the ACCC "intends to closely monitor the operation of the industry over the next two years".

The ACCC is proposing that monitoring be carried out under a "Record Keeping Rule" that would apply to a cross-section of key players, and would identify the terms and conditions of interconnection, including any criteria for either peering or discounts, along with other essential information that would indicate structural or behavioural problems.

Submissions for comments to the proposal end 12 November 2004. After considering the submissions and the public consultation, the ACCC will issue a final report in December 2004.