Changing the regulatory framework of the telecommunications
industry is needed quickly says Telstra which claims the regulatory
uncertainty is costing it the deployment of its next-generation
networks, while at the same time providing a leg up for its
competitors.
Speaking at a competition summit organized by the Service Providers
Association, (SPAN), of which Telstra is a member, Telstra's
general manager of regulatory affairs, Tony Warren said that while
the telecommunications industry has changed rapidly since
deregulation, the regulation of the industry has not.
Telstra, he said, was pushing for changes to the regulatory process
because it was being unfairly treated under current regulations.
As an example, he cited the disparity in Australia's CBDs where
fiber, which is supplied by a number of carriers, rather than the
Telstra-owned ULL (unbundled local loop) dominates the landscape.
"If the telco regime has some kind of discipline those areas won't
be regulated."
Regulation needs to be modified so that it does not "choke off"
investment, he said. Additionally, regulation should apply to
legacy networks rather than new services.
A bone of contention for Telstra is the fact that in most capital
cities an alternative to the ULL, in the form of Optus' HFC network
already exists. Sydney and Melbourne, for example both have more
than 80 percent penetration of Telstra-alternative networks to the
home.
However, Telstra is still forced by the Australian Competition and
Consumer Commission to charge low prices for competitors to access
its copper wires.
"In the CBD and metropolitan areas there is a real alternative
supply... which is winning customers in the marketplace.
"Pretending that it is not [competitive] and needs a high
regulatory environment is not justified," Warren said.
Optus' Paul Fletcher said Telstra was doing its bit to kill
competition.
Raising the fixed line cost of the ULL was one measure.
He also said Telstra's intention to deploy Fiber to The Node (FTTN)
is part of its attempt to discourage investment in the ULL, whose
copper lines need constant maintenance.
Fletcher said Optus believes in increasing bandwidth options to
customers, but that the ULL should be protected. "There is still
life in it."
According to Warren, Telstra needs to invest in FTTN because only
40 percent of residents in cities live within 1.5Kms of an
exchange, thus precluding them from access to very high speed DSL
broadband. The closer residents are to exchanges, the easier access
to speed of 10Mbs and above becomes. According to Telstra, the only
other way to get the remaining 60 percent is to use fiber.
However, due to "regulatory uncertainty", Telstra has been forced,
Warren claims, to put a hold on its plans to roll out its FTTN
broadband network. For Dennis Muscat, CEO of Pacific Internet, the
discussion about connection is not the key issue. "It's the service
[VOIP, mobility, video-on-demand and the like] that hang off this
which is key. Most of which are not realized today."
To achieve this, he said service providers like Pacific Internet
needed fair access to the network, fair pricing, and a fair amount
of time to help build themselves up so a "quasi monopoly (of
Telstra and Optus) does not manifest itself".
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