NBN Co bows to telco pressure over enterprise push

No direct contractual relationship with enterprises, NBN pledges

Network Networking Ethernet
Martyn Williams/IDGNS

In response to criticism from some of Australia’s biggest telcos, NBN Co has pledged to steer clear of any direct contractual relationship with enterprises.

NBN Co announced today that it will no longer directly enter contracts with enterprises to build out fibre connections ahead of retail service providers (RSPs) engaging with a business to sell it NBN broadband services.

Telstra, Optus and Vocus have all criticised NBN Co’s efforts to make inroads in the business market, which has seen high-profile deals to connect Australia Post, Coles and Woolworths and the overbuilding of fibre in commercial premises.

In response to feedback from RSPs, NBN Co said it “will evolve its enterprise contracting model so that RSPs will in all cases have the direct contractual relationship with enterprise customers.”

“Previously, NBN Co has at times contracted directly with enterprise customers to build connectivity ahead of those customers engaging one or more RSPs to provide operational broadband services,” a statement released by the company said.

In October 2019 the company was formally warned by the Australian Competition and Consumer Commission for discriminating between different RSPs in its efforts to crack the business market.

The ACCC said that NBN Co had offered “materially different commercial terms to different RSPs as it upgraded NBN infrastructure to support high-speed, business-grade services” and also provided Macquarie Telecom with indicative pricing information for its Enterprise Ethernet service months before it gave the same information to other telcos.

Earlier this week NBN Co said when upgrading connections to support business services it would seek access to existing dark fibre instead of overbuilding.

NBN Co’s push into the enterprise space has not been uniformly criticised. Commpete – an alliance of challenger telcos – used its submission to a parliamentary inquiry examining NBN Co’s operations to support the move.

“Enterprise telecommunications markets have long been dominated by the Tier 1 vertically integrated carriers such as Telstra, Optus and TPG,” the group argued.

“A telco without its own nationwide network of physical infrastructure had to acquire wholesale connectivity services from those Tier 1 carriers in order to compete head-to-head with them.”

Related:

Copyright © 2020 IDG Communications, Inc.

  
Shop Tech Products at Amazon