ACCC chairman sceptical of NBN efforts to deal with pricing complaints

ACCC chairman sceptical of NBN efforts to deal with pricing complaints
ACCC chairman sceptical of NBN efforts to deal with pricing complaints

Australian Competition and Consumer Commission (ACCC) chairman Rod Sims has questioned whether NBN genuinely dealt with complaints from internet retailers about over-charging for fast broadband.

Sims expressed surprise that NBN is not considering cuts to its pricing model months after a review was ordered by NBN Co boss Bill Morrow.

NBN chairman Ziggy Switkowski recently ruled out cuts to wholesale pricing on the national broadband network, saying it would only fuel a "land grab" and take value away from taxpayers and the government, transferring it to retail service providers (RSPs).

However, RSPs are not happy with the pricing model because they say the costs for NBN are much higher than traditional internet connections and are not purchasing large amounts of capacity, triggering slow internet speeds and consumer complaints.

"I did find the comments a bit surprising in the sense that we had understood that NBN was going through a consultation process with the access seekers on its pricing and we are wondering whether that consultation process is real or not real," Sims was quoted as saying by The Australian Financial Review.

In July, NBN chief executive Bill Morrow had announced a pricing review, citing an image problem after complaints of poor speeds soared.

Sims said he would not make a decision on updating the NBN's special access undertaking, a key part of the way the competition watchdog regulates pricing, until NBN's pricing consultations made progress. 

The update needs to be made to accommodate new technologies as part of the rollout of the Coalition's model for the NBN, the AFR said.

"We certainly thought their shareholder [the federal government] was interested in there being genuine negotiations," Sims said. 

“We're still expecting genuine discussions, genuine consultation.

“Our definition of consultation is not one-way. Consultation means you listen, respond and react."

Meanwhile, complaints are on the rise as the NBN rolls out to metropolitan areas and RSPs refuse to buy more capacity because it hits their margins compared to DSL connections. 

Consumer frustration is rising because by the top speeds advertised by RSPs are not being achieved in peak times, and in some cases is worse than pre-NBN speeds.

In August, the ACCC gave RSPs three months to clean up their "terrible" NBN advertising. 

It will also begin publishing speeds achieved, versus advertised speeds, on plans from RSPs. 

Nbn Broadband

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