Telco Watchdog Slams Optus-NBN Gagging Order As Anti-Competitive

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Rod Sims is on the warpath. And he has everyone from Coles, Woolies to the NBN in his sights.

Yesterday, the new Chairman of the competition watchdog, the ACCC, made an impassioned speech about his concerns surrounding the coming NBN-dominated telco environment and his fears about competition being distorted.


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“Telecommunications, particularly the National Broadband Network…. are sectors where ACCC oversight will be vigilant in the interests of both consumers and access seekers,” he warned.

The ACCC Chairman also expressed particular concern about the rollout of the NBN where other service providers, like iiNet and Internode, will continue to be reliant on Telstra’s copper network.

“During the transition it is crucial that there is equivalence of outcomes, that there is a level playing field so that the competitive landscape is not distorted as the NBN is rolled out.”

This comes as consumer advocate group, the Australian Communications Consumer Action Network (ACCAN), slam the Optus-NBN deal, which includes an ‘anti disparagement’ or gagging order, preventing the telco from criticising or making “any express adverse statement” on the NBN wireless services for a 15 year spell, while advertising rival services.

“There are existing laws prohibiting misleading and deceptive conduct, and these laws should be sufficient to address any concerns NBN Co may have about marketing claims by Optus,” the ACCAN told a competition regulator review.

“Restraints on marketing practices that are part and parcel of a healthy competitive market would have a negative effect on consumers by dampening the competition that would otherwise occur.”

The deal recently signed between SingTel owned Optus and NBN Co, is worth $800m to the No. 2 Telco in Australia, under which it will sign over its 500,000 customers to the National Broadband Network and shut down its hybrid fibre network (HFC).

 
However, the NBN Co insists the gagging order is confined to the marketing of Optus’ own wireless services only.

NBN Co CEO Mike Quigley denied the clause was anti competitive at the Australian Communications Consumer Action Network (ACCAN) meeting held last month.

Read Gagging Order: Optus Banned From NBN Criticism Here

Optus have also welcomed the new criticism of the $800m NBN deal by the consumer group, according to The Australian.

But it wasn’t just the NBN who were on the recieving end of ACCC criticism.

Sims put a number of sectors on notice, including Coles, Woolies as well as franchises like Harvey Norman, in his first address to the Melbourne Press Club yesterday.

“The two major supermarkets have significant market power, with many smaller suppliers feeling they lack a real ability to negotiate supply arrangements,” he declared.

He pledged his organisation would “watch closely to ensure any such dealings do not involve unconscionable conduct by the supermarkets.”

The “monopolistic practices” of Australia’s major airports have also been a concern “for some time,” Sims  added.
 
“Under my chairmanship I intend that the ACCC will be a sometimes noisy proponent of this view.

“We are the major Federal Government agency with the word ‘Competition’ in our title. So I believe it is part of our job.”

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