The cost to ISPs for wholesale data is getting cheaper every year. That’s the gist of the ACCC’s just-released report into domestic transport capacity, which says that the cost of high-speed telco backhaul has fallen as much as 78 per cent for long distance routes. Australia’s favourite national outpost Tasmania remains the thorn in the side of ISPs everywhere, though, with a new charge levied for the skinny pipes (and Basslink) running from the mainland.
[related title=”Tasmania’s Basslink Cable” tag=”basslink” items=”5″]
The final access determination from the ACCC sets a new, higher ‘uplift’ price for backhaul data services between the mainland and Tasmania, currently comprised of two Telstra undersea data links and the still-damaged Basslink cable. Where previously the cost of backhaul across the Bass Strait was only subject to a 40 per cent premium under the ACCC’s late 2015 draft decision, the final determination raises that uplift price to 140 per cent.
Respondents to the ACCC had varied claims on the Bass Strait pricing; TPG, which uses Telstra fibre to service Tasmania, said that the 40 per cent uplift was too high and would limit competition — essentially giving Telstra an unfair advantage in using its owned data links. Basslink, the operators of the higher-capacity Basslink cable, said that the 40 per cent uplift was too low, and would not allow the company to adequately recoup the costs of installing and servicing the cable. Optus, which uses Basslink, supports an uplift price of no higher than 80 per cent.
Because the uplift is set as a percentage increase on the set mainland transmission costs, falling overall prices meant that Bass Strait operators were receiving smaller premiums than ever. The 140 per cent uplift still means Basslink and Telstra are being paid less than before for the cost of moving data from mainland to Tasmania. The extra cost, though, is justified by the extra effort and risk involved in servicing the island; this year’s Basslink outage is an example of that economic risk.