NBN Co asks ACCC to closely police any functional separation of TPG Telecom – Telco/ISP

TPG Telecom’s program to functionally independent has received careful backing from NBN Co, conditional on the Australian opposition watchdog closely policing the problems of the arrangement.

TPG lodged a purposeful separation bid with the Australian Competitors and Shopper Fee (ACCC) in November final calendar year.

If accredited – a determination could be made as early as future month – the arrangement would cost-free TPG Telecom from some of the policies that now avert it from participating in infrastructure-based mostly opposition with the NBN.

In a submission [pdf] to that approach, NBN Co termed “the enterprise submitted by TPG … broadly appropriate”, but sought some assurances in distinct parts, as perfectly as all-around the competitive effect far more frequently.

NBN Co said that the separation enterprise must be explicitly worded to “remove the prospect for TPG’s vendors to have inappropriate entry to delicate wholesale [or] network construct information”.

It also asked that all TPG workers obtain compliance coaching on how to function in a functionally independent method, not just a subset of workers.

“The incremental charge of offering this kind of coaching to all workers must not be major,” NBN Co said.

Much more frequently, NBN Co sought assurances from the ACCC that TPG’s behaviour as a functionally separated entity, and the effect of that behaviour on opposition far more broadly, would be appropriately policed.

“The TPG enterprise and long run purposeful separation undertakings permit this kind of telecommunications suppliers to function in a drastically vertically integrated potential,” NBN Co said.

“The ACCC will no doubt be alive to the incentive, capability and potential of vertically integrated operators to have interaction in anti-competitive conduct, notwithstanding implementation of purposeful separation. 

“In the retail sector, an integrated operator’s retail manufacturers can be far more competitive than RSPs attaining that operator’s wholesale items as inputs. 

“This could arise either simply because of deeper discounting leading to a vertical cost squeeze, horizontal bundling or by leveraging across a corporate group such as in regard of non-fixed line assets that keep on being comparatively considerably less controlled (e.g. cell networks).”

NBN Co said that a vertically integrated provider “may be capable to offer special discounts on other wholesale companies this kind of as mobiles, business enterprise companies or content material in exchange for commitments on fixed companies.” 

“NBN Co is not able to be commercially adaptable in this way,” it said.

“[We] advise the ACCC keep track of functionally separated telecommunications operators closely in regard of their effect in both equally the retail and wholesale marketplaces.”

NBN Co also asked the ACCC to scrutinise the effect that a new restructure at TPG Telecom may possibly have on the capability of the telco to comply with purposeful separation obligations.