[LINK] NBN wholesale pricing set for 5 years: $24/mo.

[Jan Whitaker]

http://www.theage.com.au/it-pro/government-it/nbn-reveals-5year-fixed-price-plan-20111206-1og2v.html

Wholesale prices on the national broadband network will be frozen at 
$24 for five years.

They will then increase at half the rate of inflation, according to 
regulatory documents lodged by NBN Co.

This means the entry level wholesale price would not rise until at 
least July 2017, and then increase by no more than 1 to 2 per cent 
per year after that, depending on inflation.

However NBN Co cannot guarantee retail service providers would not 
increase retail prices independently of wholesale prices.
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The Australian Competition and Consumer Commission (ACCC) was now 
expected to review the 'special access undertaking' (SAU) and accept 
or reject it in late 2012. The SAU would be valid for 30 years and 
gives the ACCC oversight over NBN Co's costs and revenues, and 
commits the company to ''recovering no more than its prudently 
incurred costs of supply''.

''What the SAU does, is it actually makes a number of commitments in 
terms of how we will do business to the regulator.... It gives the 
industry and people a great deal of certainty on how NBN Co spends 
its money, builds the network, manages operational expenditure, 
manages prices and also manages revenues,'' the head of product 
development and industry engagement, Jim Hassell, told BusinessDay.

NBN Co has also committed to remaining a layer two provider, which 
means it would never sell services directly to consumers, government 
bodies or corporations.

Telcos have been waiting for this document to be lodged before 
signing commercial agreements with NBN Co, although at least five 
companies had already signed an interim agreement, Mr Hassell said.

NBN Co was set up by the federal government in 2009 to build a high 
speed fibre optic network to 97 per cent of premises to replace the 
current copper-wire based network. Rural and remote areas would be 
served by satellite and fixed wireless.

The project was expected to cost about $49.5 billion and take ten 
years.  About 3000 premises were already using NBN Co services, 
including satellite services and fibre-to-the-home connections in trial sites.



Melbourne, Victoria, Australia
jwhit at janwhitaker.com
blog: http://janwhitaker.com/jansblog/
business: http://www.janwhitaker.com

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