Would-be commercial rivals to the National Broadband Network have suffered a triple blow in their efforts to pre-empt the roll-out of the NBN by hooking up high-rise apartment blocks to high-speed internet services.
The federal government has capped the retail charges of cable internet service providers (ISPs) which had been hoping to beat the NBN to high-value apartment blocks. And they will be forced to separate their wholesale and retail arms, meaning they can’t lock rival service providers out of buildings that they have already cabled.
Meanwhile, strata lawyers claim they have found ways of stopping broadband cable companies, which had been forcing apartment blocks to accept their high-speed cables, using legislation originally intended to help spread the infrastructure for mobile phones.
And further clouding the picture for high-speed broadband retailers is the NBN’s $11 billion purchase of Telstra’s copper-wire infrastructure, giving the national network another set of connection options.
New rules and the price cap, announced last week as part of the government’s response to a review of NBN, will curb private sector moves to cherry-pick high-value, high-rise inner-city apartment buildings.
High-speed internet service providers have been using provisions in the Telecommunications Act to send out Land Access Advisory Notices (LAANs) to apartment blocks’ owners corporations, effectively telling them they are coming to their building whether they like it or not.
Owners corporations representing tens of thousands of apartments have already allegedly taken the notice at face value and allowed companies like Pipe Networks, the infrastructure arm of main player TPG, to install its equipment. Once it is installed, however, there is no point in other providers, including NBN, connecting theirs because of signal interference.
NBN chief executive Bill Morrow told a Senate committee this year the company would be forced to roll out fibre directly to apartments to bypass fibre to the building (FTTB) equipment that companies like TPG had already installed, as connecting FTTB equipment from two different providers was “well known” to cause interference problems.
He added that the provision of NBN services to individual apartments in buildings already cabled by other firms would then be a question of commercial viability. Such were the fears of exclusivity by default that NSW Fair Trading Minister Matthew Mason-Cox last month warned apartment owners corporations not to sign contracts with cable ISPs that would force individual residents to give up their existing internet providers in favour of the cable firms.
Now consumer advocates hope the “land grab” of high-rise premises will be a lot less attractive under the new restrictions that come into effect on January 1. Internet service providers will be forced to split their retail and wholesale businesses and operate them at arm’s length and they will be allowed to charge no more than $27 a month to other retail providers through their wholesale businesses.
Meanwhile, strata lawyers claim they have found a way of locking Pipe and other cable companies out of strata buildings completely.
Tom Bacon, of Strata Title Lawyers, has beaten back efforts by Pipe to install its service in a number of buildings in Melbourne, ignoring objections from the blocks’ owners’ corporations (body corporate).
“I acted for five buildings in Docklands, St Kilda and Southbank who were served with LAANs by TPG in June this year,” Mr Bacon says. “This was part of a wider push by TPG to acquire new customers by targeting apartment buildings with large numbers of residential units.
“This was also to beat the NBN Network from acquiring these clients as its construction of the telecommunications equipment was due to commence shortly thereafter.”
Mr Bacon claims NBN’s policy is that once it becomes aware that a rival service provider has already served a Notice (the LAAN) to install its infrastructure, then there is no point in the NBN installing its own system, so it moves on and leaves the building stuck with the single service provider.
“All five of the buildings that I acted for objected to the LAAN being served on them by TPG,” Mr Bacon says. “And, once the Ombudsman’s name was mentioned, the lawyers acting for PIPE Networks and TPG went quiet.
“There is only a set time period to object to the LAAN otherwise no further objections can be made. However, it’s not too late to challenge PIPE Networks and TPG via the Ombudsman’s office even if a building has been served with a LAAN.”