ACCC seeks comment on proposed local bitstream access service (LBAS) determination

Friday, 06 July, 2012

The Australian Competition and Consumer Commission (ACCC) is seeking comment on a proposed access determination for the declared local bitstream access service (LBAS).

The LBAS, first declared by the ACCC in February, is a wholesale access service for fixed line networks that are built or upgraded after January 2011. It does not apply to the NBN or to wireless or satellite networks.

The LBAS is a last mile fixed line service provided to residences and small business where the download transmission rate is considered ‘superfast’ - at least 25 megabits per second (Mbps).

Interim determination

Until the final determination is made, the ACCC has made an interim access determination (IAD) for the LBAS. The IAD contains both price and non-price terms and conditions for a wholesale non-NBN 25/5 Mbps service.

The IAD sets a price ceiling of $27 per service per month. The price in the IAD was set by benchmarking against the NBN Co wholesale broadband agreement price for a similar service. The IAD also sets out non-price terms and conditions of access to provide a base set of terms if parties cannot come to a commercial agreement.

“The ACCC’s preliminary view is that the proposed benchmark pricing approach is appropriate, given the limited number of services that are currently subject to the declaration,” said ACCC Commissioner Ed Willett.

Final access determination

The ACCC’s proposed final access determination (FAD) would use the same approach as used in the interim determination.

The LBAS price would be benchmarked against the regulated pricing for NBN Co, once that regulated pricing is finalised. The ACCC has also proposed that the FAD contain the same non-price terms and conditions as the IAD.

“The provisions of the IAD and the proposal for the FAD mean that there will be similar terms and conditions for access by retailers providing broadband services to consumers and small businesses irrespective of whether that is on an NBN or non-NBN network,” Willett said.

Due to the timing of the finalisation of NBN Co regulated pricing, the ACCC will not make the LBAS FAD within the required 6-month time period from the commencement of its public inquiry.

As such, the ACCC has extended the public inquiry by 6 months, until 24 February 2013.

Interested parties are encouraged to submit comment on the proposed FAD approach, particularly on the benchmarking pricing methodology, the duration of the FAD and the non-price terms and conditions to be included in the FAD.

Submissions are open until 3 August 2012.

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