Consumers 'will benefit' from Optus NBN migration deal

01/06/2012 - A Treasury official says consumers will benefit from Australia's second largest telco, Optus, migrating customers from its cable network to the national broadband network (NBN).

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Treasury executive director markets group Jim Murphy said authorities could not ignore statements from Optus in noting the telco would be better off competing as a retail provider only and not in the wholesale area.

The Australian Competition and Consumer Commission (ACCC) on Monday issued a draft determination to approve the $800 million deal between the government builder of the NBN, NBN Co, and Optus.

The deal would allow Optus to shut down its hybrid-fibre coaxial (HFC) cable network and shift about 400,000 customers to the NBN.

"As a matter of principle on these particular circumstances, given the state of the Australian market, given the huge cost of investment, one has to be a competitor in this market, a potential competitor to the NBN," Murphy told a Senate estimates hearing in Canberra on Thursday.

"Optus is saying `well, we want to opt out because we want to put our future development, our future business into the retail space'.

"Treasury, for ourselves, found that persuasive. In a draft paper the ACCC came out with that view as well."

The deal between the two parties follows the competition watchdog agreeing earlier this year to a deal between NBN Co and Telstra.

In February, the ACCC accepted a $11 billion plan to structurally split Telstra's retail and wholesale businesses, and migrate its customers to NBN Co as the telco shut downs its fixed-copper line network.

NBN Co is a government business enterprise charged with rolling out high-speed broadband fibre-optic cable to 93 per cent of homes, schools and businesses across Australia by 2021.

Opposition communications spokesman Malcolm Turnbull on Tuesday criticised the ACCC's decision, saying it was an anti-competitive arrangement.

But Murphy said government business enterprises often had community service obligations, which the NBN had in providing high-speed broadband to most Australians.

"What you are trying to do is have a competitive market, which is in the best interests of consumers, not only in terms of price but also in terms of service," he said.

Source: AAP

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