The competition watchdog has set up a public inquiry into the National Broadband Network’s wholesale service standards in the wake of record numbers of complaints from consumers and a damning assessment of competition in the sector.
The Australian Competition and Consumer Commission (ACCC) is already considering the imposition of fines and other regulatory instruments to enforce appropriate service standards across the industry.
Possible regulatory changes would include arrangements that would enable consumers to seek compensation at a retail level when minimum whole service standards are not met.
“We are very concerned about the high number of complaints from consumers around poor customer experiences, particularly in relation to customers connecting to NBN services and having faults repaired,” ACCC chairman Rod Sims said.
“Many of these complaints relate to matters set out in wholesale service level standards. We will examine whether the service levels that are currently in place are appropriate and effective.”
“This is important as what happens at the wholesale level often flows through to the retail level and affects customer experiences,” said Mr Sims.
When the NBN was set, the ACCC had been involved in setting a pricing construct, but the development of service level arrangements were left to the industry, via negotiations between the NBN Co and retail service providers.
In setting up this inquiry, the ACCC may be about to change this, and start imposing a regulatory regime that would impose standards on the industry.
The inquiry follows a report from the Telecommunications Industry Ombudsman last month that found consumer complaints about broadband connections had soared more than 150 per cent, as well as its own recent report on competition problems in the telecommunications sector.
The TIO numbers related to complaints about NBN service in the past 12 months, the majority being in relation to delays in connections, missed appointments and fault rectification.
“One of the main focuses of our inquiry will be whether there are appropriate incentives for NBN Co to remedy service failures, along with the adequacy of compensation available to wholesale customers, to ensure consumers in turn are provided appropriate redress when things go wrong,” Mr Sims said.
“While our inquiry will focus on NBN wholesale service levels, we will examine them in the context of the supply chain. We are also concerned that some service levels at the retail level are not enforceable,” he said.
“If we identify other changes to aspects of the supply chain that will improve customer experiences on the NBN, we will certainly highlight them.”
Mr Sims said the ACCC would release a consultation paper examining these issues and seeking views on whether an access determination is necessary.
The Labor opposition has welcomed the ACCC inquiry, saying it had become obvious that the NBN needed a structural alignment between responsibility and reliability.
Shadow communications spokesman Michelle Rowland said the ACCC had “clearly lost patience and was stepping in to fill the void.”
“The move to examine wholesale service levels exposes the Government’s desperate attempts to create distractions and blame retailers for every issue,” Ms Rowland said.
“Retail providers are accountable to their customers and the TIO, yet it’s not clear who NBNCo is accountable to,” she said.
“The company tasked with deploying a flawed multi-technology mix has become a law unto itself and this is not sustainable.”