Analogue Subscription Television Broadcast Carriage Service Final

Analogue Subscription Television Broadcast Carriage Service Final Decision March 2007 © Commonwealth of Australia 2006 This work is copyright. Apart from any use permitted by the Copyright Act 1968, no part may be reproduced without permission of the Australian Competition and Consumer Commission. Requests and inquiries concerning reproduction and rights should be addressed to the Director Publishing, Australian Competition and Consumer Commission, PO Box 1199, Dickson ACT 2602. Abbreviations ACCC Australian Competition and Consumer Commission Act Trade Practices Act 1974 (Cth) Analogue a service for the carriage, by means of lines, of analogue Subscription signals used for the purposes of transmitting a Television subscription television service from a facility owned, Service controlled or operated by a carrier or carriage service provider to any point on, or in, a line link, customer cabling, or customer equipment connected to that facility. CA Conditional Access specifies how content can be accessed. CSA content supply agreement CSP carriage service providers Foxtel Foxtel Management Pty Ltd and Foxtel Cable Television Pty Ltd HFC hybrid fibre coaxial network LTIE long term interests of end users SAOs standard access obligations STU Set Top Unit services comprise the hardware used for the reception and decryption of signals of content in a customer premises. Telstra Telstra Corporation LTD TPA Trade Practices Act Tribunal the Australian Competition Tribunal CONTENTS INTRODUCTION........................................................................................................5 1 LEGISLATIVE PROVISIONS ...............................................................................6 1.1 THE ACCESS REGIME ......................................................................................................................6 1.2 REVIEW OF DECLARATION..............................................................................................................6 1.3 CONTINUING, VARYING OR REVOKING AN EXISTING DECLARATION ...............................................7 2 BACKGROUND .......................................................................................................7 2.1 THE DECLARED SERVICE ................................................................................................................7 2.2 ANALOGUE ACCESS UNDERTAKINGS..............................................................................................8 2.3 DIGITAL ACCESS UNDERTAKINGS ..................................................................................................9 2.4 CURRENT STATE OF THE AUSTRALIAN PAY TV SECTOR ...............................................................10 3 ACCC’S VIEWS .....................................................................................................12 3.1 LONG TERM INTERESTS OF END-USERS (LTIE) TEST....................................................................12 3.1.1 Promoting competition.........................................................................................................14 3.1.2 Any-to-any connectivity........................................................................................................15 3.1.3 Efficient use of, and investment in, infrastructure................................................................15 3.2 WHETHER TO EXTEND, RE-DECLARE, REVOKE OR VARY THE DECLARATION, OR ALLOW IT TO EXPIRE WITHOUT RE-DECLARATION....................................................................................................16 4 CONCLUSION .......................................................................................................17 APPENDICES............................................................................................................18 APPENDIX 1: SERVICE DESCRIPTION.............................................................18 APPENDIX 2: LEGISLATIVE PROVISIONS RELEVANT TO THE LTIE ....19 APPENDIX 3: THE LTIE TEST .............................................................................21 Introduction In November 2006, the Australian Competition and Consumer Commission (ACCC) initiated a review into the declaration of the Analogue Subscription Television Broadcast Carriage Service (Analogue pay TV service), in accordance with subsection 152ALA(7) of the Trade Practices Act 1974 (TPA). The Analogue pay TV service declaration is due to expire in July 2007. This review considers the future regulation of the delivery of analogue signals used for transmitting a subscription television service and the use of (or potential use) of conditional access (CA) services. The service description is provided at Appendix 1 of this decision. The main focus of the review is to assess whether continued declaration of the Analogue Pay TV service would promote the long term interests of end-users (LTIE) of carriage services, or of services supplied using carriage services (listed services). 1 As part of its review process, the ACCC released a Discussion Paper in November 2006 seeking submissions from interested parties on whether the declaration is to be continued, varied, revoked or allowed to expire without a new declaration being made. The ACCC received three submissions from industry members in response to the Discussion Paper. The views of interested parties obtained through this public inquiry process have been taken into account in making the ACCC’s final decision. Based on the information before it, the ACCC has formed the view that it is not satisfied that continued declaration of the Analogue Pay TV service will promote the LTIE and that the declaration should be revoked. This report sets out the reasons for ACCC final decision. It is structured as follows: Section 1 outlines the relevant legislative provisions. Section 2 provides the background to the Analogue Pay TV service declaration. Section 3 provides a discussion of the ACCC final views as to whether the declared service should be continued, varied or revoked, with regard to the LTIE, any-to-any connectivity and the efficient use and investment in infrastructure. 1 For a more detailed guide to the Commission’s approach to declarations refer to the ACCC publication Telecommunications services – Declaration Provisions, July 1999. 1 Legislative Provisions 1.1 The Access regime Part XIC of the TPA sets out a telecommunications access regime. The ACCC may determine that particular carriage services and related services are declared services. In order to declare a service, the ACCC must be satisfied that the making of the declaration will promote the LTIE of carriage services, or of services supplied using carriage services (listed services). Section 152AB of the TPA provides that, for the purposes of determining whether declaration promotes the LTIE, regard must be had only to the extent to which declaration is likely to result in the achievement of the following objectives: promoting competition in markets for listed services, achieving any-to-any connectivity in relation to carriage services that involve communication between end-users, and encouraging the economically efficient use of, and the economically efficient investment in: -the infrastructure by which telecommunications services are supplied, and -any other infrastructure by which listed services are, or are likely to become, capable of being supplied. Section 152AB provides further guidance in interpreting these objectives. The relevant legislative provisions are reproduced in Appendix 2 of this document, and the objectives are discussed in further detail in Appendix 3 of this document. Once a service is declared, carriage service providers (CSPs) are required to comply with the applicable standard access obligations (SAOs) in relation to supply of the 2 declared service. The SAOs facilitate the provision of access to declared services by service providers in order that service providers can provide carriage services and/or content services. 1.2 Review of Declaration Legislative amendments to s.152ALA of the TPA in December 2002 required the ACCC to specify a term for expiry for all declarations of no later than five years. The ACCC decided to establish a declaration expiry date of 31 July 2007 for the Analogue 3 Pay TV service. 2 Section 152AR 3 ACCC (2003), Expiry Dates for Declared Services, p. 17. 1.3 Continuing, varying or revoking an existing Declaration The ACCC can extend, re-declare, vary or revoke a declaration, or allow a declaration to expire (without a new declaration being made). These powers are set out in sections 152AL, 152ALA and 152AO of the TPA. Specifically, section 152ALA requires the ACCC to review each declaration within the year preceding its expiry date. As part of the review process, the ACCC is required under subsection 152ALA(7) to hold a public inquiry about: whether to extend or further extend the expiry date of the declaration, whether to revoke the declaration, whether to vary the declaration, whether to allow the declaration to expire without making a new declaration, and whether to allow the declaration to expire and then make a new declaration. An extension to a declared service, or a new declaration, cannot be for a period exceeding five years.4 The public inquiry is to be held in accordance with Part 25 of the Telecommunications Act 1997 (Telco Act). Following the public inquiry, the ACCC must; 5 prepare a report about the inquiry under section 505 of the Telco Act; and publish a report during the six month period ending on the expiry date

Load more