Will the NBN limit competition?

There's little doubt that the National Broadband Network (NBN) will reduce the number of internet service providers (ISPs) in Australia.

Smaller ISPs will disappear as the need for local infrastructure will disappear and larger ISPs dominate. We saw it with the arrival of broadband, now it will happen again.

That doesn't mean there will be less competition. The NBN's levelling of the playing field should mean there will be more ISPs to choose from throughout the country, keeping prices down and driving innovation in service offerings.

The main opportunity rests with new types of retail service provider (RSP), which will provide services directly to homes. Pay TV, device connectivity and health are examples of the sorts of services we could see.

There's a fear, however, that this will not happen. In this program I examine whether the NBN approach is focusing too much on the old way of doing things. As you'll hear there's no steadfast commitment to this multi-RSP approach.

On the program you'll hear from:

• Graeme Dollar, COO at Engin
• Geof Heydon, director of Market development and the digital economy for Alcatel-Lucent
• Michael S Cox, independent telecommunications consultant

It all gets back to the question of Layer 2 vs. Layer 3. You could argue that enough intermediaries will be available to offer Layer 3 services, but will any of them be wholesale only and, if so, for how long?