Telstra will have advantage at NBN POIs: AAPT

AAPT has said that Telstra continuing to own the infrastructure that NBN Co will use for the National Broadband Network will provide it with an unfair advantage over its competitors.

In response to Australian Competition and Consumer Commission (ACCC) questions on the location of the 121 points of interconnect (POI), which largely conform with the locations of existing Telstra exchanges, AAPT has said that Telstra could gain an unfair advantage through the ownership of that infrastructure.

"While AAPT acknowledges the structural framework contained in the [structural separation undertaking] to ensure that Telstra does not favour itself over other access seekers in relation to access to [Telstra exchange buildings], AAPT continues to be concerned about access seekers not being treated with equivalence in relation to such access," AAPT said in its submission (PDF).

"Given that Telstra will own and operate the passive infrastructure required for connection to the NBN at the bulk of listed POI locations, there are a myriad of ways in which Telstra will be able to take advantage of its position to the detriment of access seekers."

AAPT also said that it would be difficult to prove, because in the past, Telstra has charged "very high establishment fees" to get access to a Telstra exchange without explaining what the fees actually pay for, and often charges are applied by Telstra on an ad hoc basis.

In smaller internet service provider (ISP) Harbour IT's submission (PDF), the company again brought up the issue of the number of points of interconnect disadvantaging smaller ISPs, which would be required to pay large amounts for backhaul in order to reach regional locations under the 121 POI model.

Harbour IT has 10,000 National Broadband Network (NBN) fixed and satellite customers across the board, and said it is hoping to focus on regional Australia, but it is harder to reach into regional Australia with backhaul.

Harbour IT suggested that this problem could be overcome by reducing the number of POIs by confining them to capital cities, making NBN Co become a backhaul provider, or increased regulation over pricing for backhaul.

"Adoption of a capital city-based POI architecture for the NBN may be the most technically efficient way of addressing the current imbalance between competition and backhaul routes and retail layer competition for NBN services in regional areas, if it were adopted at the start of the NBN design and build process," Harbour IT said.

"However, it is recognised that the NBN network design phase is now in the past, and the build against the current design has commenced."

To overcome this issue, if NBN Co were to provide backhaul from the regional POIs back to the city "mega POIs", Harbour IT said this would improve competition.