Report
Description

The National Broadband Network (NBN) is designed, built, and operated by NBN Co with the mandate to ensure that, at the wholesale level, all Australians have access to very fast broadband. The wholesale terms of access are of fundamental importance to competition in dependent markets and have a strong bearing on the price, service standards and degree of reliability experienced by end-users.

Given that NBN Co largely operates as a monopoly within the wholesale broadband market, uneven bargaining power exists across the supply chain. This structure undermines ordinary mechanisms of competition. Ordinarily, good faith commercial negotiation between the supplier and acquirer of a service can be expected to result in reasonable commercial arrangements. Generally, this process can be relied upon to ensure that markets exist with low barriers to entry, competitive pricing and product quality and variety. However, this process is not sufficient for competitive markets where only one party has power in a market, as NBN Co does, given it is the near to ubiquitous provider of last mile fixed access.

Therefore, there is a need for regulatory oversight to make up for this market failure. This means that the wholesale terms of access to the NBN can be potentially developed via commercial negotiation or via regulatory processes with the implementation of an access determination. Here, the role of regulation is to address the uneven bargaining powers which currently exist between access seekers and NBN Co. Effective terms of access are critical to the existence of competitive and efficient markets and promoting the long-term interests of end-users.

This report sets out the ACCC's findings in respect to their public inquiries into National Broadband Network (NBN) entry level pricing and NBN wholesale service standards.

Publication Details
License type:
CC BY