NBN providers clamour over Telstra exchanges

Service providers AAPT and Optus have warned of the potential for continued discrimination in Telstra's favour at points of interconnect under the National Broadband Network.

In separate submissions to the competition watchdog, the providers argued Telstra's continued dominance over the exchange space used to house most of the 121 NBN permanent points of interconnect for the national network would continue to place the incumbent telco in an advantageous position for infrastructure competition.

Of the 121 points of interconnected planned for the network, 111 would be built inside existing Telstra exchanges, requiring network access seekers to speak directly with Telstra for access to infrastructure space at those locations.

Optus had argued in favour of using Telstra exchanges as a logical location for most points during the Australian Competition and Consumer Commission's confirmation process in May.

However, in a new submission to the watchdog, Optus claimed it and other carriers would be forced to comply with restrictions Telstra itself would not need to.

"There is scope for Telstra to abuse the process and obtain an unfair advantage over 'other access seekers'," the telco wrote in a submission [pdf] to the competition watchdog.

As it owned the locations used to house NBN and access seeker infrastructure, Telstra would not need to gain its approval for infrastructure use, Optus said.

"NBN Co's 'first come, first served' philosophy will need to account for the timeframes required by all access seekers to gain access to Telstra's facilities particularly if any capping of the exchange facilities is applied," it wrote.

AAPT [pdf] too expressed concern over its competitive disadvantage at building infrastructure in Telstra exchanges it had previously been absent from.

Changes to the number and location of some points of interconnect in May had already caused "substantial financial detriment" to AAPT.

It feared further costs of more location changes to the points were made.

Under NBN Co's Wholesale Broadband Agreement, access seekers would be provided up to a year's notice for relocation or changes to the points.

"While Clause C13.2 is intended to apply to all access seekers equally, it will be significantly more detrimental on AAPT and other access seekers in comparison to Telstra, thereby giving Telstra an unfair advantage," AAPT wrote.

AAPT urged greater oversight of potential PoI changes by the ACCC, though the competition watchdog had since relieved most responsibility for ultimate location of points during the network build.

Submissions from AAPT, Optus and Telstra all argued in favour of some form of discrimination, albeit in highly regulated circumstances, in order to differentiate between carriers on the NBN.

Telstra [pdf] and AAPT pointed to precendents in New Zealand and Europe which indicated not all differences between carriers were necessarily discriminatory.

"Where discrimination is efficient and promotes competition it should be permitted," Telstra wrote.

The ACCC had proposed exceptions to non-discrimination provisions for NBN Co in cases where the wholesaler believed an access seeker would not comply with agreements or was not deemed credit-worthy.