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Tuesday August 22, 2017
NBN Watch: Complaints, Regulators and debunking silly CVC rumours
by James Pinnell | Aug 11, 2017 | Comment Now
In the fight between NBN and providers, no one wins.
NBN Watch: Complaints, Regulators and debunking silly CVC rumours

One of the most common complaints that I hear from people struggling inside a deadlocked fight between their RSP and NBN Co is that there is no 3rd party arbiter available them. The industry is governed by a handful of semi-relevant legislations based on what sort of customer you are and what you are trying to achieve. What makes things even more confusing is that while NBN Co is a government-based business, it’s not a department or agency, which means it is outside the jurisdiction of the Commonwealth Ombudsman (which investigates Federal service issues).

Currently, the TIO (Telecommunications Ombudsman) lists NBN Co as a member and can be contacted if there is a complaint. On this front, however, results have been anecdotally poor among those I had spoken to whom had escalated their complaint. Some were told that their RSP is the responsible party of their complaint, while others were told that NBN services were not covered under their jurisdiction. Officially, the TIO *does* consider NBN services part of their duty, namely provisioned services – but if the NBN isn’t available at your residence, they can’t help you get them.

The basic rule is; if you haven’t had any luck resolving your issue via your RSP, lodge a complaint with the TIO. It's the only direct access you have to any sort of independent arbitration – and depending on your situation it has the authority to mediate and direct parties to reach an amicable resolution. It is not a miracle worker, however, and cannot force NBN Co to bend to your will. But if you feel like you are being stonewalled it’s the best (and, really, only) option you have to find some kind of positive outcome.

Outside of the TIO, there are two other regulatory agencies that handle telecommunications. The first, the ACMA (Australian Communications and Media Authority), is the “hard legislative” arm of the industry; its job is to ensure that the legislation and regulations therein are being adhered to.  Unlike the TIO, it does not deal directly with consumers – as a government agency it liaises between the government and the company in question. Its role is to make sure the industry is doing things properly – and it's clear that both NBN Co and RSPs are not doing a good enough job as they pass the buck.

The other is the ACCC, who deal with competition and fair trading generally. The ACCC and ACMA are both responding to this situation under the differing powers they both hold – ACMA is attempting to investigate customer complaints and try some détente tactics to bring both parties to the table. The ACCC, like Choice magazine, is attempting to at least provide some consumer transparency, by monitoring various connections to build a database of average speeds across the network. I have lauded this in the past and while it does not actually fix any problem, it highlights some of the more obvious and deficient RSPs that aren’t even attempting to provide the service they promise.

But the problem with all this consumer advocacy is that much of it avoids hitting the root cause of the problem. A claim in The Australian recently lobbed a grenade into the pool after it claimed that RSPs could solve the CVC problem by charging an extra $10 per user. This was quickly and expertly debunked by a number of experts who claimed that this amount of CVC would only amount to roughly 640kbps of extra capacity per user, rather than the 10 or 20mbps that many are finding is deficient during this period. While it’s clear that RSPs are both under-pricing and over-promising many of their plans, the reality is that all of this has, is, and always will be a problem with CVC pricing.

Let’s make this perfectly clear – CVC either needs to be extremely cheap (as in, under a dollar) or should not exist at all. There are frankly dozens of problems with the NBN, but CVC is easily the largest bottleneck and hands down the #1 reason why customers on NBN connections will never be satisfied with their speeds. The government’s ridiculous need to make a profit on what is obviously designed as a public utility is breaking apart whatever patchwork business model that they have cobbled together. Under the existing plan, where Fibre was everywhere, CVC charges might have made more sense because connections were uniform and all RSPs would operate on the same playing field. But this is not the case anymore, as mistake after mistake (121 POIs, the MTM Mix, Insane ROI, Refusing to Write Down the network) is one wooden stake after another into the heart of this project.

New Zealand did it right – they put in place a single fixed access charge with no CVC charges. This immediately put every single RSP on the same playing field, keeping plan prices low, encouraging higher speeds and pushing the emphasis back on each RSP’s internal network performance. CVC simply allows RSPs with high customer concentrations to bargain with NBN Co for a low enough price to increase their performance at the expense of smaller RSPs with less bargaining power. Before long, we’ll be right back at a tri- or even duopoly, as smaller RSPs die on the vine as CVC pricing kills their profitability.

The NBN had the ability to transform our country’s communications and present us as an even more desirable place to live and work. But in its current, neutered, state, it will always be second rate. It will always perform poorly and the blame will continue to split between both sides. But let's be clear here – until the government (I’m looking at you, Labor) has the guts to shred that ROI and remove the CVC charges we will always have a second rate network. MTM has already solidified obsoletion into the core of our taxpayer funded disaster – let’s not destroy any chance of competition at the same time.



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