| US Rules for Australian Unbundling? |
| Thursday, 21 January 2010 20:32 |
 Although the U.S. FCC has killed most unbundling, Primus wants the U.S. Trade Representative to demand stronger DSL unbundling rules in Australia. They are probably right on the law, although there's little reason to think the U.S. FCC will reverse the Bush-era exemptions that keep most broadband free of unbundling. Most U.S. broadband is exempted from regulation by calling it an "information service" exclusively. Obviously, it's both. The U.S. Australian "Free Trade Agreement" requires
"Each Party shall ensure that major suppliers in its territory accord suppliers of public telecommunications services of the other Party treatment no less favorable than such major suppliers accord in like circumstances to their subsidiaries, their affiliates, or non-affiliated service suppliers, regarding:(a) the availability, provisioning, rates, or quality of like public telecommunications services; and (b) the availability of technical interfaces necessary for interconnection. (12:7) ... Each Party shall maintain appropriate measures for the purpose of preventing suppliers who, alone or together, are a major supplier in its territory from engaging in or continuing anti-competitive practices. (12:8)" The typical U.S. broadband situation is the local cableco and telco effectively keeping out competition, and a simple reading of the treaty would imply the U.S. is not fulfilling our international obligations. The U.S. has similar deals with Canada, Mexico, Chile, and a dozen other countries, but I doubt the USTR or FCC would protect the U.S. rights of Telstra or Bell Canada to U.S. unbundling. Primus, a U.S. based company that's the third largest ISP in Australia, will probably have to fight their own battles as well. Most U.S. policymakers are comfortable if there are only two players in a market, although experience and all the literature is clear that two companies are more likely to signal each other to keep prices high than to compete vigorously. The result is that high speed services in the U.S. are twice as expensive as France or Britain. (Thanks to Grahame Lynch of Commsday for pointing me to the story and John Horan for forwarding me the primary sources.)
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