The most basic element of the telecommunications infrastructure recognised by the Act is the “line”:
line means a wire, cable, optical fibre, tube, conduit, waveguide or other physical medium used, or for use, as a continuous artificial guide for or in connection with carrying communications by means of guided electromagnetic energy (Section 7 of the Act)
While not “used” for carrying communications, dark fibre is “for use” in doing so and therefore should qualify as a being a “line”. Further, since a line link consists of one or more lines, every line should also be a line link. It therefore follows that deployed dark fibre is both a line, and a line link. However, line links as such are not regulated by the Act since what are regulated are “network units that are used to supply carriage services to the public” (section 41 of the Act).
According to the Act, a line link is a network unit if it connects places in Australia that are at least 500 metres apart, or if it is one of several line links in common ownership, and each of them connects distinct places in Australia, and their length adds up to at least 5 kilometres. Where deployed dark fibre satisfies these tests, it is therefore a network unit. However, regulation should then only apply when the network unit is “used to supply carriage services to the public”.
Section 7 of the Act provides that:
carriage service means a service for carrying communications by means of guided and/or unguided electromagnetic energy.
It is important to note that “carriage service” is not the act of carrying communications, or an aid to doing so, but the provision of a service for doing so. Necessarily, that implies a service to someone other than the owner of the network unit. Merely carrying communications for one’s own purposes, or deploying network elements that as yet can do nothing, is not a “service”. Hence it could be argued that the mere deployment of dark fibre cannot constitute a carriage service, as it is not capable of providing the service of carrying communications nor is it “used” for that purpose within the meaning of section 41 of the Act.
It follows that dark fibre should be free from regulation under the Act, although matters may be quite different once the fibre is “lit”.
When fibre is “lit”, the prospect of the operation of section 42 of the Act becomes a live issue:
42 (1) If there is only one owner of a network unit, the owner of the network unit must not use the unit, either alone or jointly with one or more other persons, to supply a carriage service to the public, unless:
(a) the owner holds a carrier licence; or
(b) a Nominated Carrier Declaration is in force in relation to the unit.
(2) If there is only one owner of a network unit, the owner of the network unit must not allow or permit another person to use the unit to supply a carriage service to the public unless:
(a) the owner holds a carrier licence; or
(b) a Nominated Carrier Declaration is in force in relation to the unit.
It was concluded above that dark fibre could constitute a network unit. Once lit, it may be used for a “service for carrying communications by means of guided and/or unguided electromagnetic energy”. But section 42 will only apply if the fibre is used to provide such a service “to the public”. To the extent that the owner uses the fibre for its own purposes, and not to provide service to the public, it could be argued to be free of regulation under section 42. It is therefore necessary to understand when services are, and are not, provided to the public.
Section 44 of the Act leaves open a range of activities that may be carried out free from carrier regulation. Specifically:
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A single owner of a network unit may use it to provide communications and carriage services to and between members of their immediate circle.
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A single owner of a network unit may use it to provide communications between their immediate circle and the public, as long as:
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no two members of the public can communicate with each other via it; and
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the communication is not sent to multiple persons simultaneously; and
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the content of the communication has not been designated by the Minister administering the Telecoms Act for the purposes of section 44.
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Joint owners of a network unit may use it to provide communications and carriage services to and between persons who are members of the immediate circle of both of them.
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Joint owners of a network unit may use it to provide communications between persons who are members of the immediate circle of both of them and persons who are not, as long as:
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no two persons who are not members of the immediate circle of both of them can communicate with each other via it; and
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the communication is not sent to multiple persons simultaneously; and
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the content of the communication has not been designated by the Minister administering the Telecoms Act for the purposes of section 44.
It is important to realise that the unregulated reach of a network unit in single ownership may well be larger than that of a jointly owned network unit, since a single owner may provide carriage services between members of their immediate circle, but joint owners have complete freedom only with respect to persons who are within the immediate circle of all of them – and that might be a class of zero.
A single school or college, for instance, might provide a communications network for the benefit of all its students and staff, and permit communication to and from outsiders (but not between outsiders). Two institutions that jointly owned a network unit would have to treat their own staff and students as outsiders, except for any who were staff and/or students of both. In other words, joint ownership of a network is not a device for extending its unregulated reach – quite the opposite.
How usefully these unregulated activities may be to a would-be owner of a private network largely depends on the ambit of the “immediate circle”. If, for argument’s sake, the “immediate circle” encompasses everyone to and between whom the owner of a network unit wishes to facilitate communications, then a private network could be argued to be established free of carrier regulation.
While the Act permits unregulated private networks, the definition of “immediate circle” (section 23) is quite complex and restrictive, to ensure that it does not permit unregulated de facto public networks. In theory, if a particular instance of a proposed private network is designed in a way that threads through section 23 such that:
- all end users are within a common immediate circle (in the case of a network unit in single ownership); or
- all end users are within the immediate circles of all owners (in the case of a network unit in joint ownership); or
- end users outside the immediate circle (or, in the case of joint owners, the overlapping portion of their immediate circles) cannot communicate with other such persons via the network unit, and do not receive simultaneous communication or designated content;
then there may be no need for that network unit to be subject to a carrier licence. However, such an arrangement may be artificial or impractical to sustain over time. Otherwise, the owner/s of the network unit in question must either secure a carrier licence or effect a Nominated Carrier Declaration for the network unit.
Where a network unit is to be used to provide carriage services to the public, its owner must either:
- hold a carrier licence; or
- secure the agreement of a person who does hold a carrier licence to be responsible for the observance of a carrier’s licence with respect to that network unit (“Nominated Carrier Declaration”).
The obligation to secure a carrier licence or a Nominated Carrier Declaration rests squarely and solely on the shoulders of the legal owner of the network unit. Once either of them is in place, the prohibition in section 42(2) of the Act is obviated:
(2) If there is only one owner of a network unit, the owner of the network unit must not allow or permit another person to use the unit to supply a carriage service to the public unless:
(a) the owner holds a carrier licence; or
(b) a Nominated Carrier Declaration is in force in relation to the unit.
In those circumstances, the owner may use the network unit, or allow another person to use it, to supply a carriage service to the public. It may do so on any terms that are consistent with the Act and the carrier licence.
A group of schools and colleges could own one or more network units and use them to supply carriage services to the public relying on its own carrier licence, or a Nominated Carrier Declaration. It could control and provision the management and operation of the network unit and carriage services as it sees fit, whether provided by a third party or the collective itself, however the responsible carrier (whether the owner of the network unit or a nominated carrier) must always retain sufficient control and discretion to ensure that the Act and the conditions of the relevant licence are observed.
In summary, it would be possible for a group of schools and colleges to:
but in no case can the holder of the carrier licence surrender control and discretion sufficient to ensure that the Act and the conditions of the relevant licence are observed, and the various agreements in place must reflect that.
Indefeasible Right of Use or IRU is a long-term lease of capacity of a data channel. Such arrangements are typically made in the case of international trunk cables, which sell off rights to long-term capacity.
In the situation where intra-Australian network unit/s are subject to an IRU in favour of a user group such as schools and colleges, or if such a group owned network unit/s and granted an IRU over it, the principles set out above would apply without alteration. To the extent consistent with the applicable carrier licence and the Act, the owner could pass management, control and use of the network unit to another. The IRU would simply be the particular basis on which the right to use that capacity rested.
Depending on the community of end users it is desired to serve, it is possible to interpret the Act as permitting construction of a network free of the requirement to secure a carrier licence. A large corporate group could count within its ‘immediate circle’ its employees and those of its related corporations, and hence there is potential for a viable private telecommunications network to be created.
However, the expansive and complex definition in section 23 of the Act does appear to prevent schools (and universities) from treating students of other schools, or parents of students, as being within their immediate circle. As a consequence, this outcome clearly limits the utility of any unregulated network for such organisations.
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