ISPs still competitive despite market concentration: ACCC

The markets for both broadband and voice services are “operating competitively” under current regulatory arrangements despite market concentration, according to the Australian Competition & Consumer Commission (ACCC).

The final report of the regulator’s communications sector market study showed that competition between suppliers of both fixed and mobile services is evident in pricing, and that the recent entry of some players in some networks can help increase competition further.

“Despite market concentration, competition in the sector is leading to lower prices, greater choice in services and service providers, and bigger inclusions for voice and broadband services on fixed and mobile networks,” ACCC chairman Rod Sims said.

“Competition will increase further as Vodafone expands its NBN footprint and TPG deploys its wireless network, bringing additional choice to consumers in terms of quality and pricing of telecommunications services.”

The market study examined likely competition and efficiency developments in the communications sector over the next five years — when it is expected that 5G technology will be adopted, the NBN rollout would be completed and that the government announces further plans.

Sims said that sustained progress on NBN speeds, pricing, and service standards issues was important for the regulator, particularly with NBN Co placing longer-term arrangements for pricing directed at encouraging the efficient use of its network.

“While there is still some uncertainty about the nature and timing of 5G deployment, we are confident it will create great opportunities for both industry and consumers. 5G also has the potential to accelerate fixed to wireless substitution,” Sims said.

“Importantly, the price and service performance of NBN services will influence the extent to which this substitution will occur.”

Late last month, the ACCC released its Measuring Broadband Australia program report, finding that fibre-to-the-node (FTTN) connections are still holding back some ISPs’ NBN speeds, despite making improvements in maximum speeds during peak hours.