Continuing to use NBN prices as a guide, the ACCC’s latest decision sets the terms for accessing major altnets’ networks over the next three years
ACCC concludes superfast broadband access review
On 12 March 2024, the Australian Competition and Consumer Commission (ACCC) released its final report for the superfast broadband access service (SBAS) access determination inquiry. This report contains the ACCC's decision on the maximum wholesale prices and other important non-price terms governing retail providers’ access to superfast (i.e. 25Mbps+) fixed broadband networks. The decision states that regulated SBAS access prices will continue to be benchmarked against NBN prices for equivalent residential broadband services. The regulation will be effective from 1 September 2024 until 1 March 2027, and will apply if network owners and access seekers cannot reach satisfactory commercial agreements.
Over 1m non-NBN subscribers are set to benefit
Since the ACCC first “declared an SBAS” in 2016, the market has consolidated as larger firms acquired smaller rivals. TPG and Uniti are now relatively large, vertically integrated providers, and are the two largest suppliers of the SBAS in Australia. Their networks combined cover more than 1m premises, primarily in apartment buildings and new residential housing estates. While there is a range of other smaller providers (generally with fewer than 30,000 active customers), TPG and Uniti represent the sole fixed broadband network operator in many areas. Having consulted with operators and consumer groups, the ACCC has therefore determined it appropriate to regulate the conditions of access to the two companies’ networks. It considers this will enable many consumers and businesses to select from a broader range of retailers and offers that can better meet their needs – potentially discovering plans superior to those available on the NBN.
The decision could constrain wholesale prices for 100Mbps+ services
According to the ACCC, regulated monthly wholesale prices for the 25/5Mbps and 50/20Mbps speed tiers will give retail providers greater certainty over the access charges they pay. Also, by benchmarking against equivalent NBN access costs, retail operators will be able to develop consistent product offerings to consumers across all networks. The regulator considers that its changes will put downward pressure on the wholesale cost to access the entry level 25/5Mbps service, as well as the popular 50/20Mbps service. While network owners will continue to have the flexibility to set their own prices for other services, the ACCC expects that regulated prices for the 50/20Mbps speed tier will also have an “anchoring effect” on wholesale prices for higher tiers.
Striking a balance between the interests of consumers and the industry
The access determination also regulates connection, transfer and end user appointment fees for SBAS networks, which the ACCC considers will make it easier for households to switch operators and will limit their potential exposure to missed appointment or other ad hoc charges. Anna Brakey (Commissioner, ACCC) is confident that the final decision strikes the right balance between protecting the long-term interests of consumers and allowing network providers to earn the revenues required to continue investing in and upgrading their networks over time. Reaching this point, however, has taken considerably longer than envisaged due to uncertainty and delays around NBN Co’s variation to its special access undertaking. With a third draft version eventually approved in October 2023, the ACCC was in a position to finalise its SBAS review.
