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Communication underpins the social and commercial fabric of society. It is essential for all Australians to enable them to undertake daily activities, including maintaining contact with family and friends, and accessing commercial, government, medical and education services. And communication services can be a matter of life and death when medical or other emergencies arise. Further, and very importantly, communications services are the key foundation for the digital transformation of the economy and the productivity, innovation and efficiency gains that it will bring. 

The Australian Competition and Consumer Commission (ACCC) uses market studies as a tool to improve our understanding of specific sectors and to help promote effective competition in markets. We are undertaking this market study to provide a wide ranging stocktake of how Australian communications markets are evolving in the face of recent and prospective changes. This will enable us to determine how we can best ensure that economic regulation is responsive to changing market circumstances and that only regulations necessary to address market failure, promote competition and protect consumers are in place. This includes ensuring that over the longer term innovation and investment are not stifled, competition is encouraged and the interests of consumers are well served.

Key points:

The Australian communications sector has been undergoing a period of significant change that is affecting how supply chains function and the nature and extent of competition in retail and wholesale markets. This change includes both structural reform, as a result of policy initiatives, at the centre of which is the rollout of the NBN, and the rapid pace of technological advance and product innovation that is occurring globally.

We consider that the economic regulatory framework for the communications sector has proven to be capable of accommodating major changes to the sector and has allowed for appropriate responses during the transition to the NBN. We do not find that there is currently a need for significant changes to this regulatory regime.

Notwithstanding considerable concentration in both fixed and mobile retail markets there is evidence of competition between the major service providers of broadband and voice services. Smaller providers and new entrants have the potential to provide additional competitive tension by constraining the larger providers.

The rollout of the NBN is a major investment in communications infrastructure and is having a significant impact on the Australian communications sector. The changes within the supply chain and consequential impacts on consumers and retail service providers have inevitably been a key focus of the market study.

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