How long have we waited for the Federal Government to get serious on Telstra and separation? We had Labor fail to do this when deregulating telecommunications and the Coalition pass up opportunities to do something when privatising the rest of Telstra. Now, the Government looks set to do something.
Telstra Corporation will be forced to split its retail and wholesale businesses or risk losing access to wireless broadband under new reforms proposed by the federal government.
Under the plans, the government will force Telstra to conduct its network operations and wholesale functions at arm’s length from the rest of the company if it does not voluntarily do so through an undertaking to the Australian Competition and Consumer Commission (ACCC).
Hmm, not quite structural separation but the spectrum threat is interesting.
Telstra would also be prevented from acquiring additional spectrum for advanced wireless broadband while it remains vertically integrated, owns a hybrid fibre coaxial cable network and has an interest in Foxtel.
This direction is interesting but how this will play out is somewhat uncertain. Will Telstra do things voluntarily on their own terms or fight to the death and drag it all out. For now, we can applaud the solid change in Government direction. As Minister Conroy said: “The measures in this legislation will finally correct the mistakes of the past.” Amen to that.