ACCC – Draft Report on Telstra FAD

From the ACCC:  The Australian Competition and Consumer Commission (ACCC) has released a draft report today on making a Final Access Determination (FAD) for the declared wholesale ADSL service.   This service is used to provide users with broadband internet and other services over Telstra’s copper network.

The draft FAD sets out proposed price and non-price terms for the declared wholesale ADSL service to apply until 30 June 2014. The ACCC proposes to apply the FAD nationally, but limit the application of the FAD to Telstra.  Telstra continues to hold dominant positions in the markets for retail and wholesale fixed-line broadband services.

Says ACCC Chairman Rod Sims:

Setting regulated prices for access to Telstra’s wholesale ADSL service will assist access seekers to offer a range of competitive fixed-line broadband internet services to retail broadband users … While access seekers and Telstra will still be able to negotiate their own terms and conditions of access, the FADs will establish a benchmark for Telstra and access seekers to fall back on.

In calculating the draft prices for the ADSL FAD the ACCC has used the same Building Block pricing framework used to estimate prices for the other declared fixed-line services provided over Telstra’s copper network.

“The proposed decision will foster competition in retail fixed-line broadband markets and maintain efficient investment incentives in the transition to the National Broadband Network,” Mr Sims said.

In February 2012, the ACCC declared the wholesale ADSL service and simultaneously released an interim access determination (IAD), which resulted in Prices for the wholesale ADSL service were regulated for the first time after the wholesale ADSL service was declared by the ACCC in February 2012.

According to the ACCC:

The cost-based prices included in the draft FAD are, overall, somewhat lower than the IAD charges. Both the draft FAD and IAD prices are below the wholesale prices that the majority of access seekers were paying for the service prior to declaration.

The proposed expiry of the draft FAD is 30 June 2014, the same expiry date as the FADs for the other declared fixed line services. This will allow the ACCC to review the price and non-price terms for the wholesale ADSL and other declared fixed line services at the same time.

The inquiry period for the wholesale ADSL inquiry was recently extended to 13 August 2013, but the ACCC expects to release its final decision on the FAD for the wholesale ADSL service prior to that date.

The ACCC invites all interested parties to make submissions on the draft report and draft FAD by 5 April 2013.

The draft decision, draft FAD and a short guide to the wholesale ADSL service (including prices) will be available at:

You can read the whole story from the ACCC here.

Contact Matthew Nicholls (ph: +61 3 8376 7131) to discuss your requirements.