From: Kaon [ronin@pongrass.com.au]
Sent: Tuesday, 30 September 2003 12:07 PM
To: ECITA, Committee (SEN)
Subject: Inquiry into competition in broadband services

To

The Secretary
ECITA
References Committee
Canberra ACT.

From
Kaon Li
4/14-16 Wright Street
Merrylands, Sydney
New South Wales 2160
Phone : (Work) 02 9369 3111 (Mobile) 0405 124 492

Dear Sir/Madam

In regard to the Senate inquiry into broadband competition, I would like to make the following comments:

a)   the current and prospective levels of competition in broadband services, including interconnection and pricing in both the wholesale and retail markets;

Thanks to the work of ACCC and other bodies in opening the ADSL wholesale market, competition in the ADSL services are fierce - the same however cannot be said of the two other mainstream broadband technology available right now - cable and satellite. In the event of cable it's a duopoly between Telstra and Optus, with the standard sub-$100 package offering 3 Gig of data. There is no competition in cable. The one-way Satellite market is dominated by Telstra (again with a 3Gig limit) and iHug (2 Gig peak, with the option of 2 Gig offpeak as an addon). The other providers offering satellite tends to be iHug resellers. Currently, two way satellite (Telstra only) is so expensive that it's not considered a viable broadband option for residential users.

The lack of competition in the cable and satellite market is a reflection of the high cost of building the infrastructure, and unless the Government choose to force Optus and Telstra to open their cable network for wholesale, there will be no competition. There is however a new development in the satellite market - a Thai company (Shin
Satellite) is posed to launch a satellite services that would provide coverage to Asia and Australia, and it's the ideal technology to bring broadband coverage to many rural areas. However it's disturbing to note that REACH, a company joint owned by Telstra and PCCW have locked into a deal with Shin Satellite, and that has to potential to rule out any form of competition with Telstra's existing price structure for satellite services.

(b)   any impediments to competition and to the uptake of broadband technology

My current place of abode cannot get ADSL or cable. I have used one-way satellite for over one year, but find it disappointing due to the huge latency inbuilt into the technology and the slow speed of uploading. When I apply for ADSL, I have received a notification that the exchange I'm on is a secondary exchange, and there is no plan to upgrade the exchange to support ADSL anytime soon according to Telstra. I believe there are a lot more people like myself in Australia who cannot get access to either ADSL or cable, and the greatest impediments to uptake of broadband technology may be that for many it simply isn't available.

(d)   the impact and relationship between ownership of content and distribution of content on competition; and

The CEO of Telstra have recently announced that he would like Telstra to not only offer broadband, but broadband content as well. Being both the content provider and broadband provider introduces two issues which may stifle competition, either by offering exclusive content unavailable to other ISP, or by making it more expensive to access other bodies providing content on the internet when using the Telstra network. Just like how Telstra's ADSL wholesale service is not suppose to give favorable treatment to their ADSL retail over other ISP, it is very important that if Telstra offers paid contents over the internet, they must not discriminate against other ISP from access in order to push their own retail broadband services.

Thank you for your time.

From
Kaon Li