Issue: 46/08

Report to Members 2008

November 26, 2008

2008 saw an incoming Labor Government after almost 11 years of Liberal Government covering a period from the introduction of full competition on 1 July 1997 through the privatisation of Telstra and significant Government funding programs for regional communications and accelerated roll-out of broadband services.

National Broadband Network

A centrepiece of the Labor Government’s election policies was the National Broadband Network, a plan to deliver a minimum of 12Mbps to 98% of Australia premises using Fibre to the Node architecture. The year began with submissions to the Panel of Experts in March 2008, followed by submissions on the NBN Regulatory Framework and Solutions for Rural and Remote areas in June 2008, a Senate Select Committee Inquiry started in July with submissions due in August and hearings in October. ATUG held member forums in all States to discuss our NBN position. The key concerns were: keeping a focus on the long-term interests of end users as the key objective for telecommunications policy decisions, affordability, network design to support competition and choice, open access and wholesale service equivalence, customer migration planning and ubiquitous high speed broadband connectivity. ATUG is calling for an open debate about the regulatory framework to support choice for end users in an NBN environment.

International Roaming

Another key focus for ATUG in 2008 has been the price of International Mobile Roaming, ATUG’s Roam Fair Campaign. End users value the convenience of voice and data roaming services but find extortionate prices to use these services and unsatisfactory work-arounds to avoid these prices. ATUG has been successful in getting support for this initiative from the Minister. A House of Representatives Inquiry was established to hear views from all parties. The issue has been taken up in international fora including APECTEL. ATUG held member forums throughout Australia and made a submission based on member input. End users in EU countries have been enjoying significant reductions for voice services, now to be followed by SMS and data reductions, after regulatory intervention. ATUG will keep pressing this issue during 2009. The issue for ATUG is not informing end users of exorbitant prices but achieving reductions so that prices are closer to efficient costs.

CDMA Closure

2008 saw the closure of Telstra CDMA network in regional Australia with over 2 million users and its replacement with Next G. After determining on the basis of a report from ACMA that the network should not be switched off on 28 January as first proposed, the Minister held a Stakeholders Forum in Canberra in February to discuss issues of concern. ATUG canvassed issues with members and discussed these at the Forum. ATUG provided updates to members through our website ahead of closure on the 28th April 2008. ATUG provided a detailed summary of the Forum for members’ use in negotiating satisfactory change-over including handset and antennae issues.

Competition

A key feature of the communications market over the last few years has been increased dispute and legal action. The degree of disputation, arbitration and litigation culminated in an action by Telstra in the High Court which went to core issue of competition and access to the PSTN network. The Court decided in March 2008 that the telecommunications access regime set out in the Trade Practices Act did not amount to an acquisition of Telstra’s property. The Court said, “The objects … in the 1997 Telecommunications Act and in Part XIC of the Trade Practices Act are wider than and different from that narrow self-interest which, statute apart, is all that one participant in a market would ordinarily consult when striking a bargain with another participant in that market.” For ATUG this was a welcome assurance about the basis for competition in telecommunications and the rightful place for regulation in regard to essential infrastructure. The debate will continue into 2009 about whether Australia’s policy framework for communications should fundamentally shift away from the interests of end users to a position of encouraging investment and letting end user interests take care of themselves. ATUG will continue to argue against this position.

Broadband Market Developments

The broadband market has seen improvements in better prices, higher speeds and larger download limit packages. They are directly related to competition and were made possible by Unbundled Local Loop regulatory decisions. An area of concern to ATUG in 2008, apart from migration to the NBN environment, has been the delay and difficulties members experience in changing broadband providers. ATUG has been working on this issue because until customers can easily exercise their right to switch providers, strong competition cannot emerge. In the past, local number portability and mobile number portability processes were put in place by industry to make the markets for fixed and mobile services more competitive for end users. Simple, seamless processes are not yet in place for broadband switching and ATUG continues to hear stories about members being without services for weeks when they attempt to switch providers. ATUG has raised this issue with Communications Alliance, the ACCC and the ACMA’s Consumer Consultative Forum. Model processes have been developed in other countries to deal with this problem and we will continue to press this issue during 2009.

Mobile Market Developments

During the second half of 2008 a number of service and pricing issues began to emerge with mobile services which raise questions of service performance and quality. As the dependence of end users on mobile services has increased and the possibilities for new forms of services and transactions become clearer, it is important that service quality stays high. On the cost side, an increase in mobile drop-outs and a concomitant increase in call connect charges has started to concern members. It has also become clear that the full benefit of the ACCC’s mandated price reductions (from 22c to 9c per minute) for mobile termination have not been passed on in full to end users. These are issues which will stay on ATUG’s agenda in 2009.

Regional Communications Market Developments

2008 has been a big year for regional communications issues. The Labor Government cancelled the OPEL contract, the Australian Broadband Guarantee program has been updated but it is not fully functional at present with end user choice limited in effect to satellite services until there is more clarity on service quality issues for 3G services and the role for wireless broadband. ATUG sees wireless broadband as an important spur for competition and innovation in difficult to serve areas. ACMA has released increased spectrum to support wireless broadband and the focus now is on getting the ABG funding to support the development services in rural areas. However far the NBN is able to reach with Fibre to the Node architecture, there will be a role for wireless in filling the gaps before satellite becomes the right choice. The Government now has the recommendations from the Regional Telecommunications Inquiry Review Committee. ATUG will continue to make inputs on behalf of members who are located in regional areas or have branch offices or project sites outside capital cities. ATUG’s concern with ubiquitous connectivity reflects the needs of business end users to communicate internally or with their customers all across Australia – whether for banking, retail, property, mining, health, education or government service delivery. ATUG’s Regional Communications Roadshow visited a further 15 regional centres speaking with many local people about the availability of broadband services.

SME Market Developments

ATUG has continued to work in the SME sector to improve the availability of services and the awareness by SMEs of new services such as mobile broadband, Voice over IP and the importance of security in a broadband enabled world. We held 10 SME events all over Australia which were well supported by industry partners and well attended by SME and related government and representative organisations. SMEs do not have the knowledge or buying power of bigger organisations when it comes to communications services. But the role of SMEs in the economy, the need for improved awareness of e-security measures and increased reliance of small and micro businesses on communications services has meant ATUG’s contribution has been welcomed. A growing issue in this sector is increased use of teleworking arrangements.

Advocacy and Representation

ATUG has maintained strong links with the Department for Broadband, Communications and the Digital Economy, the Minister and his office, the ACCC, ACMA, Communications Alliance, the Internet Industry Association and the Communications Consumer Action network. ATUG has developed stronger links during the year with the Internet Society and the Australian Computer Society. We have been able to take member issues directly to relevant decision makers and have our views considered in the decisions that matter to end users.

International Links

During 2008, ATUG has maintained strong links with INTUG, APECTEL and the OECD to ensure our members and our views are up to date with the latest thinking on developing issues. ATUG attended the APECTEL 7th Ministerial Meeting and the OECD Workshop on the Future of the Internet Economy as part of the Australian delegation. ATUG has worked closely with the Communications Managers Association in the UK, TUANZ in New Zealand and the EVUA (Enterprise Users Group) who also deal with business end user interests.

ATUG Operations

For the second year, ATUG presented the Awards for the Effective Use of Broadband to users from all over Australia. ATUG also presented the 19th Annual ATUG Excellence Awards for innovations, telecommunications management, innovation and service performance. ATUG’s Charles Todd Award for 2007 went to Roger Bamber, General Manager in Telstra Countrywide.

ATUG held over 100 events during 2008, ranging from the ATUG 2008 and ATUG Regional Conference to monthly Cross Connect events in all States and Territories including Darwin, Member Forums on NBN and International Roaming, Regional Roadshow events in 15 centres from Kununurra to Mt Gambier, 10 SME events from Wollongong to Perth. In all over 2000 people attended ATUG events during 2008.

ATUG sent ATUG This Week and ATUG Opinion every week to keep members right up to date with developments locally and internationally of relevance to their activities and decisions on communications. We received very positive feedback on many occasions. ATUG also maintained a strong focus on “currency” on the ATUG website home page, using this tool to bring latest information to members immediately.

2008 has been a very interesting year and with the National Broadband Network bids closing today, 2009 is shaping up to be a bigger and busier year than ever before, the outcomes of which will be more important than ever to the ‘long term interests of end users.’

I would like to record ATUG’s appreciation to you, our members, for your financial support, your interest in our activities and the information you provided throughout the year, which has made it possible for us to represent you even more effectively in 2008.

Yours sincerely,

Rosemary Sinclair
Managing Director
Australian Telecommunications Users Group (ATUG)
T: 02 9495 8999 F: 02 9419 3889 Email: rosemary.sinclair@atug.org.au