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As you may have heard, the first part of the independent cost-benefit analysis of broadband and review of regulation – also known as the Vertigan Review – has been released by the Government.

Satisfaction with NBN Reforms
The Review Panel has taken a moderate approach to the issues, finding a high level of satisfaction generally among the communications industry and stakeholders with the NBN reforms. The Panel itself backs this positive assessment. The Panel concludes that on the whole, "the broad framework should be retained largely unchanged for the time being" with some specific exceptions.

Recommended Modifications
Differential Wholesale Pricing: The recommended modifications to current arrangements include freeing up NBN Co to offer different price terms to different wholesale customers where it aids efficiency, which non-discrimination obligations now prevent.

ACCC Accountability: The Panel also recommended more accountability and oversight of the ACCC where it makes "decisions of enduring impact" such as making an access determination. Regarding the ACCC's decision-making on when to "declare" (regulate) a service, the Panel supported maintaining the existing test in its current form: the Long-Term Interests of End-Users (LTIE).

Regulating VDSL Services: A specific recommendation is for the ACCC to begin the process of regulating "vectored VDSL" services. This is a technology that boosts the internet speeds possible via the copper network and may soon be deployed as part of the new NBN "multi-technology mix". The Panel is looking forward to the challenge of ensuring retail competition exists over vectored VDSL – where the best performance is achieved when there is only a single provider in a locality.

Access to Facilities: The Panel recommends the Government should look at clearly defining the ACCC's powers to regulate access to facilities like Telstra exchange buildings and ducts.

In its final pages, the Report also responded to Telstra's submissions on the difficulties with the NBN switch-over process, saying it is not convinced there should be a regulatory change. The Panel takes the perspective that industry and government need to work together to improve migration.

Our View
ACCAN is pleased that the Panel recognised that regulatory stability is what the telco sector needs in order to roll out faster broadband quickly to more Australians. ACCAN was one of many stakeholders who voiced concern about a major overhaul of industry arrangements so soon after the NBN reforms. We look forward to working with the industry and government on some of the recommendations.