Internode warns of NBN backhaul cartel

 

Compromise will be "bad for everyone".

The Federal Government has been accused of putting Telstra and Optus' interests ahead of its ambition for the NBN to create a "level playing field",as debate raged on points of interconnection (POI) to the next-generation network.

Points of interconnect are the places where NBN Co will hand over traffic carried on its network to an access seeker's [ISP] network.

NBN Co has proposed 14 aggregation POIs in the capital cities. The proposal was met with concerns from the competition watchdog and backhaul providers, who said it could isolate their fibre assets.

But the managing director of ISP Internode Simon Hackett spoke out in support of the 14 POI model overnight.

He criticised rumoured attempts by the Government to "average" the different extremes being touted by NBN Co and industry critics, arguing it would be "akin to the classic mistake in politics of choosing the average between two opposing views instead of being brave enough to make an appropriate decision."

Hackett said that a mandated compromise between 14 and 200 POIs "would suit neither opposing POI camp.

"The outcome would be bad for everyone," Hackett said.

"It would 'half fix' the commercial drivers of the big guys, while 'half hurting' everyone else. Permanently. And in a way that may be impossible to fix later on."

Hackett argued that the "many POI" model would concentrate power in the hands of Telstra and Optus, potentially leading to "cartel" behaviour and prices.

"They [Telstra and Optus] will permanently have their fingers in the value chain of everyone else in the industry - something the NBN was intended to avoid - by charging all the other RSPs [retail service providers] to reach the NBN POIs via their fibre backbones," Hackett said.

"Because there will be very few of the big players, the access pricing to access the NBN POIs will tend toward cartel behaviour  - a high price with no economic driver toward reducing it over time.

"The commercial interests of Telstra and Optus appear, disturbingly, to be more important to the government than keeping the NBN playing field level."

Copyright © iTnews.com.au . All rights reserved.


Internode warns of NBN backhaul cartel
 
 
 
Top Stories
NewSat defaults on $26m in overdue Lockheed payments
Jabiru-1 satellite build hits further hurdles.
 
IBM denies plans to cut 112k jobs
But admits to further restructuring.
 
ATO investigates 25 tech giants in tax hunt
Prepared to take tax evaders to court.
 
 
Sign up to receive iTnews email bulletins
   FOLLOW US...
Latest articles on BIT Latest Articles from BIT
Franchisees, here's something you should know about
Jan 23, 2015
You need to know the Code if you are a franchisee or franchisor as the penalties are significant.
Xero users rejoice! Quoting has finally arrived
Jan 23, 2015
It has taken years, but Xero has at last added integrated quoting to its online accounting software.
You can now get a no-contract wi-fi tablet from Telstra
Jan 17, 2015
Telstra has began selling wi-fi tablets out of contract without paying extra for cellular ...
Get your business ready for 2015: mobile payments
Jan 2, 2015
These handy apps from MYOB, Xero and others can reduce your administrative load and improve ...
Xero prepares for key feature coming in 2015
Dec 19, 2014
Xero users will be able to track how their business is comparing to other Xero users.
Latest Comments
Polls
Who do you trust most to protect your private data?







   |   View results
Your bank
  36%
 
Your insurance company
  5%
 
A technology company (Google, Facebook et al)
  9%
 
Your telco, ISP or utility
  8%
 
A retailer (Coles, Woolworths et al)
  4%
 
A Federal Government agency (ATO, Centrelink etc)
  18%
 
An Australian law enforcement agency (AFP, ASIO et al)
  14%
 
A State Government agency (Health dept, etc)
  7%
TOTAL VOTES: 3029

Vote
Do you support the abolition of the Office of the Information Commissioner?

   |   View results
I support shutting down the OAIC.
  27%
 
I DON'T support shutting the OAIC.
  73%
TOTAL VOTES: 965

Vote