Telstra Forced to Open Copper to DSL by August

Dominant Australian telecommunications carrier Telstra has given in to regulatory
pressure and will delay the roll out of its wholesale asymmetric digital
subscriber line (ADSL) service until it can allow competitor ISPs to also
offer DSL over the same network.

The Australian Competition and Consumer
Commission has obtained a written assurance from Telstra that it would
launch its own ADSL service simultaneously with an “unconditional local
loop” (ULL) product. The ULL service will enable ISPs to offer DSL, voice
and other broadband connectivity solutions over the copper-based local loop.

The Telstra move was directly caused by the ACCC decision to “declare” the
local loop last year. This meant that Telstra, as owner and monopoly
provider of services on the copper wire networks between telecommunications
exchanges and customer premises, had to offer this “local loop” for use by
other providers.

The key part of the declaration was that if the third party providers did
not like Telstra’s conditions, an arbitrator could be brought in to settle
things fairly. Telstra had previously resisted advances from competitors
who had wished to offer wholesale high-bandwidth connectivity using
technologies like DSL by saying it could not meet its costs without pricing
the service prohibitively.

The ACCC said it was “encouraged” by Telstra’s assurance, but technical and
operational rules to stop carriers disrupting each other’s services would
not be completed until September, further delaying the technology roll out.

As an adjunct to this discussion, the
Internet Industry Association is convening a taskforce for informal
discussion between industry members about opening up broadband networks to
other service providers.

“We say it has to be ubiquitous, equitable and available to anyone who is
in a position to offer services,” said Peter Coroneos, executive director
of the IIA.

The IIA counts many of the major broadband players among its membership,
including Telstra, C&W Optus, Austar, Chello, Fairfax, News Interactive and
OzEmail. The taskforce will contain 25 members – reflecting the diverse
range of constituencies which stand to win or lose from outcomes in this
conflict.

“There is no debate about that, the only question is how to do it,” said Mr
Coroneos. “For that, you have to look at competition laws, and how they are
working in practice.”

Mr Coroneos also said Telstra’s announcement was “encouraging”, but that it
would still disadvantage those ISPs who would not able to test their
services out before the product was launched.

“It would have been nice to see Telstra unbundling before they started
offering services, because other people have the same sort of development
times as Telstra does for a new product,” he said.