Telstra tussles over greenfield duct standards

Telstra has lobbied the competition watchdog to establish standards for pit and pipe in greenfield estates over concerns those rolled out by developers were not up to scratch or poorly maintained.

The request came as the telco has reportedly refused to continue purchasing infrastructure constructed by developers in the estates.

Telstra is now the provider of last resort for small developments of less than 100 premises but continues to gain business in larger developments as some contractors fear continued delays in rollouts from NBN Co in such estates.

But according to Robin Russell & Associates managing director Robin Russell, the telco had pushed to be contracted for designing and developing the infrastructure — known as pit and pipe— from scratch in order to avoid any issues with non-compliant or poorly maintained ducts.

"[Telstra] has continuing concerns over compliance standards, inspection fees and its own inspection process," he said in a note on the company's website.

"So Telstra has now been forced to call a halt to new 3PPP contracts until these issues have been resolved.

"Sure developers can still design and install the conduits and pits. Telstra will even install its copper wires. But Telstra will not assume ownership of the conduits and pits. The developer will retain ownership, and all the responsibilities that go with that."

Telstra this week asked the Australian Competition and Consumer Commission to establish a third party access code which, it suggested, would set out procedures for accessing and maintaining ducts in greenfield estates as well as those for resolving disputes or any financial or legal nature of transferring ownership of the infrastructure.

Its requests came as part of a submission (pdf) to the ACCC's consultation on updating an industry code that governs telco access to mobile towers and underground infrastructure.

Third parties — such as estate developers — would not normally be covered by the code, which Telstra said was justification enough to hive off those compliance standards into a separate framework.

"There is currently no obligation under the Telco Act for third party owners to maintain their pit and pipe at an appropriate fibre ready standard on an ongoing basis," the telco said.

"A third party access code could also assist third party owners to make an informed decision about whether they are willing to maintain those facilities to an appropriate standard, or if they would prefer to transfer ownership to a carrier with the experience and resources to maintain such facilities."

Duct ownership has been the source of ongoing complaints from several parties including Telstra, NBN Co and the estate developers, as parties continue to negotiate exactly who owns the infrastructure housing fibre or copper networks in the new developments, and who is responsible for maintaining it.

Despite this, NBN Co claimed in its submission (pdf) to the ACCC that it had experienced "no major issues" in seeking access to existing mobile towers or underground facilities as a result of the existing code.

Other telcos claim squeeze

Although the updated code is intended to reflect only mobile towers and underground facilities, tier two telcos have used the consultation process to warn of continued squeezes on pricing for exchange access and associated cabling currently negotiated commercially.

In three separate submissions, iiNet, AAPT and Adam Internet all alleged that Telstra was effectively charging two times more than necessary to recover the costs associated with providing exchange space and access to key network equipment.

They also argued that commercial pricing charged by Telstra for the internal interconnect cable (IIC) used to connect third party ADSL infrastructure with Telstra's network was "excessive and fail[s] to account for the fact that Telstra elsewhere recovers costs".

"Without access to Telstra's confidential costing data ... access seekers have limited cogent ability to question, and hence to negotiate, Telstra's facilities access charges," iiNet said in its submission (pdf).

AAPT said Telstra's negotiated prices were "excessive, inefficient and contrary to competition", claiming the requirements to access existing exchange space in order to connect to the National Broadband Network in future would only exacerbate the issue.

"Given that most NBN [points of interconnect] will be in Telstra exchanges there is little doubt that access to External Interconnect Facilities will be a bottleneck where Telstra again controls the access terms of its competitors," it said (pdf).

However, Telstra claimed the current code did not need to include consideration around exchange access costs, and that negotiated agreements with carriers had worked to date.