NBN Co rejects calls for more price controls

NBN Co has told telcos that complaining about the company's price model to provide evidence on how it will negatively affect them.
Written by Josh Taylor, Contributor

NBN Co has refused to rethink its split access and capacity charge model for wholesale products on the AU$37.4 billion National Broadband Network (NBN), telling telcos they must prove that it will have a negative impact on them.

The challenge came in a letter posted on the ACCC's website yesterday (PDF).

The price controls in the Special Access Undertaking (SAU) document, which outlines the services on the NBN over the next 30 years, have come under criticism from Telstra, Optus, Macquarie Telecom, and AAPT. They have said that discretion over the capacity charge built into NBN Co's pricing model could lead to larger price rises on the NBN than what the company has said due to increased data usage on the network.

But NBN Co said in its letter that the proposal to cap wholesale access prices or the separate capacity charge was "dangerously simplistic".

"It is not clear what further price commitments are intended to address," NBN Co said, adding that the existing cap on the wholesale price at inflation minus 1.5 percent was sufficient enough.

"If access seekers consider this is not the case, such that they, their end-users or their suppliers are unable to make complementary investments necessary for the ongoing efficient use of NBN Co's services, then NBN Co suggests access seekers document and evidence their concerns in detail for both the ACCC [Australian Competition and Consumer Commission] and NBN Co," the company said.

In the letter, NBN Co also provided the ACCC with financial forecast information that the ACCC had previously requested, but the documents remain confidential, and the ACCC did not publish the associated documents.

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