Self-regulation failure forces Conroy to lay down NBN law

In an interview with the ABC’s 7.30 Report, Conroy appeared to infer that the government had been forced to lay down the law on the NBN, both to remove the need for the major players to agree on what was possible and to prevent the process from being derailed by their disagreements.

“The processes that this sector [are] normally engaged in are completely out of control,” said Conroy.

“We have a situation where the sector can't cooperate, it can't have a discussion, it can't reach a common position.

“That's why we've stuck with one consistent position, and said 'here's the path we're going on, we're going to deliver a faster and cheaper broadband to 98 percent of Australians and expand and improve broadband to that remaining two percent',” said Conroy.

The industry, however, is not entirely in disagreement on the core NBN principles. For example, common threads such as open access can be found across a number of the proposals that have been submitted under the RFP.

Speaking to iTnews, David Kennedy, a research director at Ovum Research, said that while the communications self-regulation regime introduced in 1997 had made industry consensus on contentious issues – such as access to eachother’s network infrastructure - ‘very hard to find’, there was in fact some common ground between many players.

“What we’ve actually seen evolve is a standoff between Telstra and the rest of the industry, with the ACCC and sometimes the Minister called in as referees,” said Kennedy.

“The polarisation is between Telstra and the rest. It’s been very hard for those two groups to form consensus on issues because they are diametrically opposed on them generally.”

Kennedy also said that despite Telstra’s exclusion from the RFP process, it would be impossible to keep them fully out of the NBN.

“I think they have to be involved in final arrangements in some way if only because any alternative bidder would still have to use Telstra’s copper,” said Kennedy.

“An alternative operator will want to get access to Telstra’s sub-loops as cheaply as possible, but Telstra will likely want a higher price. Even if the government requires Telstra to provide access to its sub-loops there’s going to be a huge argument over the interconnection price.”

Much of the ‘wrangling’ and negotiation with Telstra is still yet to come, Kennedy claimed.