SAU Discussion Paper and Wholesale Broadband Agreement July 2011

NBN Co has been established to build a national, wholesale-only broadband network. It is intended that this network will advance a vibrant, innovative telecommunications industry for all Australians.

NBN Co recognises that it will play a central and transformational role in the Australian telecommunications industry. NBN Co has designed a commercial framework that will assist its customers to provide innovative solutions. NBN Co will also be bound by a number of legal and regulatory requirements that stipulate how it can offer services to its customers.

NBN Co has today released two key documents for its customers to consider - the Special Access Undertaking Discussion Paper and the Wholesale Broadband Agreement.

SAU Discussion Paper

Since its inception, NBN Co has benefited greatly from consulting with industry on a range of matters, including its network design, its products, and the Wholesale Broadband Agreement. The release of the SAU Discussion Paper today continues NBN Co's ongoing consultation with the industry on the manner in which it intends to operate, and NBN Co expects to again benefit from industry feedback.

The SAU Discussion Paper describes the key commitments that NBN Co intends to make in its SAU, including in relation to its long-term pricing framework, approach to recovery of prudently incurred costs, product development, customer consultation and key non-price terms and conditions.

The discussion paper outlines the proposed approach to pricing of key "Price Controlled Offers" that are necessary to deliver end-to-end services on the NBN, and the operation of NBN Co's proposed Regulatory Asset Base (RAB) and long term revenue constraint methodology. It also describes how the NBN Co anticipates providing an ongoing role to the ACCC over the term of the SAU, to ensure the commitments made in the SAU continue to remain relevant as the industry evolves.

NBN Co is seeking feedback on its SAU discussion paper, and asks respondents to send their feedback to by 19 August 2011. In the interests of transparency, NBN Co plans to publish all submissions on its website. NBN Co would appreciate it if those lodging a submission can provide a document suitable for publication. Alternatively, if respondents have confidential information they wish to provide, respondents may provide both a public and commercial-in-confidence version. In that event, the public submission will be published on NBN Co's website.

In continuing its practice of engaging with the industry to fully understand its needs, NBN Co will also consider requests to consult directly with interested parties.

NBN Co significantly modified many aspects of the SAU between the July Discussion Paper and the version that was lodged with the ACCC on 5 December 2011. As a result, some of the feedback received from industry in response to the July Discussion Paper is no longer relevant to the SAU as lodged, but is included here for completeness.

Wholesale Broadband Agreement

On July 28th, 2011 NBN Co also released the third edition of its Wholesale Broadband Agreement ahead of moving into the commercial launch of its services in October 2011. The WBA will be the contractual vehicle NBN Co will use to supply all of its products and services to its customers and will have the regulatory purpose of "declaring" NBN Co's services as required by our legislation.

The third edition of the WBA is the culmination of feedback from NBN Co's customers over a ten month period of industry engagement. In this time, NBN Co has completed two separate pubic consultation processes, public workshops (in Sydney, Melbourne and also via webcast), and performed customer deep dives involving more than 100 hours of face to face discussions. This engagement has allowed NBN Co to respond to customer concerns in a manner that it believes balances the legitimate interests of end users, customers and the objectives of the NBN. NBN Co thanks industry for its ongoing engagement, and believes the final WBA is a much better agreement thanks to that engagement.

In releasing the WBA today, NBN Co wishes to provide its customers with an opportunity to consider and discuss with NBN Co the substance of the documentation prior to publication as a Standard Form of Access Agreement for the purposes of Part XIC of the Competition and Consumer Act 2010, which we plan to do in September.

Documents released today include the core terms and conditions of the WBA, the Product Catalogue, Credit Policy and Product Development Forum Processes.Also released is the Product Technical Specification underpinning NBN Co's Fibre Access Service.

NBN Co has also taken this opportunity to provide a paper that summarises the key issues raised by customers during the second WBA consultation. This document is intended to provide an insight into the views of its customers on particular issues and the position NBN Co has taken in response. A copy of each submission is also provided.

NBN Co recently conducted industry briefing sessions on the WBA and SAU in Sydney and Melbourne.A copy of the presentation slides and a link to the webcast of the Sydney session is also released today.