Internode MD: Time to bin NBN anti-cherry-picking laws

Internode MD: Time to bin NBN anti-cherry-picking laws

Anti-cherry-picking laws are an antique and should be discarded, according to Simon Hackett

Anti-cherry-picking laws introduced by the Government to prevent high-speed fibre networks from competing with the National Broadband Network (NBN) are now obsolete and should be discarded, according to Internode managing director, Simon Hackett.

He was speaking at the Communications Day Summit in Sydney.

Cherry-picking refers to ISPs putting in fibre networks in high population density areas to undercut NBN Co prior to an NBN rollout. The ISPs can then charge less for services compared to NBN Co since they are not required to subsidise network rollouts in low density - and expensive - regional areas.

Anti-cherry-picking laws were introduced in the NBN Access Bill in 2010.

The laws have received some criticism since its introduction. Some considered them draconian since they also encompass small scale targetted fibre rollouts for small businesses which pose no threat to the NBN.

“The only carriers big enough to break the NBN are Telstra and Optus, economically,” Hackett said. “They are the only ones with the infrastructure to break the NBN by out-competing it.

“NBN Co has done deals with both those companies to buy their cooperation - if there is a problem here it has already been solved.”

NBN Co struck deals with Telstra and Optus for infrastructure access and migration of customers for $11 billion and $800 million, respectively.

“What you are left with here is the residual effect where all the wired service providers, that might care to drop an optical fibre network link into a five person business, are breaking the law if they do that.”

Hackett also noted the inconsistency of the anti-cherry-picking laws as they exempt wireless ISPs.

Business-centric wireless ISP, BigAir, can continue setting up 1Gbps wireless broadband links and not be affected by those laws. Neither BigAir nor Internode, according to Hackett, are big enough to impact the NBN’s economic viability.

“We are not a threat - [anti-cherry-picking laws] are actually busted and needs to go away,” he said. “The problem it was originally set up to solve was solved commercially in those two big deals with Telstra and Optus.

“What is left is just a threat to innovation.”

The Communications Day Summit continues.

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