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G9 welcomes the ACCC's 'Encouraging' Decision on Special Access Undertaking
17 Dec 2007

The G9 consortium of competitive telecommunications companies today welcomed feedback from the ACCC on the special access undertaking (SAU) lodged by the G9 earlier this year.

"The ACCC's draft decision is encouraging," said Paul O'Sullivan, Chief Executive of Optus.

"We are pleased that the ACCC has stated that it is generally comfortable with the G9's proposed approach to pricing, and that it considers the pricing proposed for the first three years may be reasonable."

The lodgement of the SAU, and its consideration by the ACCC, has been an important stage in the G9's progress towards building a competitive national broadband network using fibre-to-the-node to deliver high-speed internet access.

Michael Simmons, Chief Executive Officer, Soul said: "The G9 continues to make great progress on its bid plans and the ACCC's decision vindicates much of that work."

David Tudehope, Chief Executive Officer of Macquarie Telecom said: "We said when we lodged the SAU that we expected it to be viewed favourably by the ACCC because it provided for lower prices and improved broadband and was pro-competition

"Today's decision, while in formal terms a rejection of the SAU in its present form, shows clearly that the ACCC does view our approach favourably.

"The ACCC has specifically noted that the pricing approach we have proposed is one widely used for long term investment in other industries such as gas, electricity and rail.

"Because the ACCC has only two formal options available to it under the Trade Practices Act, to 'accept' or 'reject' an SAU, it is common for the ACCC to reject an SAU at the draft stage even if it is broadly comfortable with the framework set out in the SAU. This then gives the party which has lodged the SAU the option to address the ACCC's concerns by lodging and a revised document prior to a final decision.

Ravi Bhatia, Chief Executive, Primus said: "Now that the ACCC has issued a draft decision concerning the SAU, the G9 has the opportunity to respond to the issues the ACCC has raised, and to lodge an amended SAU in due course."

Dianne O'Hara, Chief Operating Officer, TransACT said: "The G9 will commence work immediately on a revised SAU, with a view to lodging the revised document in the New Year."

The purpose of the SAU is to set out the terms and conditions on which the G9 would provide 'access' to the network which it plans to build - and to give the ACCC the opportunity to approve or reject those terms.

"We always knew that obtaining regulatory approval would be a process involving a number of steps over many months" said iiNet Chief Executive Michael Malone.

"Today's decision by the ACCC is an important milestone in that process. We now have a clear direction in which to proceed as we work to resolve the ACCC's remaining issue."

Simon Hackett, Chief Executive of Internode, said "The G9 is the only party which is as far advanced towards obtaining the necessary regulatory approvals to build a FTTN network."

The prices proposed by the G9 in the SAU are substantially lower than those Telstra is reportedly planning to charge if it were to build a national broadband network, because unlike Telstra the G9 is not trying to protect existing monopoly profits.

"It is particularly pleasing that the ACCC has indicated that our pricing for the first three years may be within the reasonable range of prices for this types of service and network. The requirement for prices to be 'reasonable' is a statutory criterion which must be met in order for the SAU to be approved by the ACCC. Therefore this is a very significant statement by the ACCC which vindicates the pricing approach we have taken," said Paul Broad, Chief Executive of AAPT.