ACCC to probe impact of NBN, Netflix in Australia

The Australian Competition & Consumer Commission will study the impact of NBN services, the network demands from the rise in streaming content and the growth of mobile data consumption.

The ACCC announced the market study yesterday, which will focus on competition and efficiency in the communications sector amid "major structural change", with a view to completing the study in 2017.

“Rapidly evolving technological developments, structural change within the sector, product innovation, and changing consumer preferences are all contributing to this change,” ACCC chairman Rod Sims said.

“We recognise the communications sector is one that all Australians have an interest in, and one that facilitates economic growth. Importantly, the study will also allow the ACCC to consider a wide range of interrelated issues that have been raised by the sector and that go to the proper functioning of the market."

The study will identify trends and issues likely to significantly affect efficiency and competition over the next three to five years. Sectors under the microscope will include fixed and mobile network services, core and aggregation network services, such as internet protocol (IP) switching and domestic and international transmission, and services using over the top platforms and content delivery mechanisms, such as the video-on-demand services from Netflix, Stan and Presto.

According to the regulator, the market study will focus on:

• The changing structure of communications markets, particularly the transition to a fixed-line market in which NBN Co is the wholesale provider to retail service providers, and consolidation and market concentration within the retail sector.
• The growth in availability of services provided ‘over the top’ (OTT) using the internet as a delivery platform. These services include social network platforms, communications and marketplace apps.
• The exponential growth in the demand for bandwidth and data in recent years, largely reflecting the emergence of streaming music and video content services, placing significant demands on network capacity.
• The increased use of mobile data by consumers and the increasing preference for mobile as a way to access the internet. The availability of wi-fi services is also facilitating the use of mobile services and further improvements are anticipated with the deployment of 5G.