Telstra adopts Qantas pitch on opening mobile network

Telstra adopts Qantas pitch on opening mobile network

Summary: Telstra CEO David Thodey has said the foreign-owned mobile companies Optus and Vodafone could invest as much in their own networks as Telstra has.

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TOPICS: Telcos, Telstra, NBN
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The government should remember that Optus and Vodafone are international companies competing with the majority-Australian owned Telstra before it thinks about forcing Telstra to open up its mobile network, CEO David Thodey has said.

Late last week it had been reported that Telstra may consider "taking action" against the government if it decided to force the telco to open up its mobile network in regional and remote locations to rivals Optus and Vodafone.

Today, Thodey told journalists that he was "vehemently opposed" to regulation in the mobile sector because it was a competitive industry, and that Telstra was competing against two mobile network operators owned by foreign entities — Optus by the Singaporean SingTel, and Vodafone by the Hong Kong-based Hutchison and UK-based Vodafone Group — that would have the power to pump further investment in their own networks.

"We compete against global companies, and not local companies, and I think that's important for any regulator to look at," he said.

"We have 1.4 million Australian shareholders who put their own money into this company, and they should get a reward."

Thodey said that if he felt the regulation was "unjustified" then Telstra would take action to protect the interest of its shareholders.

At the same time, however, he said that in a similar vein to Australian airline Qantas' recent lobbying to the Commonwealth Government to lift the cap on its foreign ownership, the foreign ownership rule on Telstra should be reviewed.

"Over time, as the nation moves to NBN... I think it should be reviewed."

Telstra is currently renegotiating with NBN Co to allow the government to implement its proposed new policy for the national broadband project that would see parts of Telstra's existing copper lines used to connect homes via fibre-to-the-node technology. Thodey said it was too early to comment on the renegotiations but said that Telstra was not seeking any more money from the existing AU$11 billion deal.

"All we can say is it is our intent to support NBN Co in any way that we can. I've said we'll honor the contracts we have, and as [Communications Minister Malcolm Turnbull] said: not a dollar more; not a dollar less," he said.

But added that "incremental work" would be negotiated on "commercial terms".

Topics: Telcos, Telstra, NBN

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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5 comments
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  • Monopolistic Infrastructure, Competitive Services

    This article demonstrates the absurdity of the Coalition government arguments for "increased competition" and "open opportunities for business" with the NBN.
    Key, core service delivery infrastructure networks as water, electricity, road, rail and communications should be implemented as government owned monopolies, while the services delivered over those infrastructure networks (and the maintenance and support of them) can be opened for competitive, commercial operations.
    It makes no sense at all to duplicate infrastructure components such as the mobile carrier network or the NBN, as suggested in the tag line "foreign-owned mobile companies ... could invest as much in their own networks as Telstra has."
    It is like suggesting Sydney should introduce a second water supplier who would need to dig up and lay pipes into all the streets before they could start delivering water to customers.
    Instead, we should have a single body responsible for the entire water distribution nework, but allow new entrants to the market to build and deliver water treatment plants that would feed their water into the grid according to easily meaasured standards. The single body responsible for the water distribution grid should be a government owned body for control of the monopoly, but could also outsource its maintenance and support to competitive bidding.
    The same approach should be applied to the NBN, with competition for delivering data services being open for commercial providers, and a single government owned body responsible for delivering and managing the entire data distribution network, both reliably and efficiently.
    Telstra has to be made to open up access to its network to other data service providers - it cannot be expected that other carriers duplicate similar infrastructure.
    amg3826
    • Spot On!

      Not a truer word spoken! The NBN is the vehicle that will put communications infrastructure into Government hands, we just need the same done with the mobile network!

      Essential services need to be Government owed with profits going back into the infrastructure (i.e so we don't end up with public/privately 100 year old cooper - which does the nation no good!)
      ioswoody
  • So

    If it's " not a dollar more; not a dollar less", whats the hold up?

    I suspect Telstra is asking for something besides money, and considering how much Malcolm wants/needs it, I also suspect Malcolms "shareholders" (us) will end up with some other undesirable outcome.
    Tinman_au
  • Yawn. This sounds like another jingoistic lecture about how the evil furriners are trying to eat the lunch of the battlin' Aussie monopolist. :)
    anonymousI
  • Spread too widely

    With Telstra far reaching other ventures (Foxtel, Office 365 come to mind) which make them bucket loads of money, why bother with the most important job a Telco has? Providing Voice and Data Delivery services. Investing in infrastructure to benefit growth for the future. What we are seeing is a distinct lack of forward vision and far too much profit raking.

    Now don't get me wrong, a public company does have an obligation to it's shareholders, but to me it would seem far more beneficial to indeed build the best network (not just mobile), to attract more customers, to consume more services, to make more money.

    Why are they so short sighted with pair gain and RIM systems barely keeping the aged copper network functioning? We're bounciung against the ceiling of what the network is capable of, yet with the demise of fibre NBN no relief is in sight.

    Privatizing Telstra has been the worst train wreck ever. At the very least it should have been structurally separated into a wholesale section with government interests, with the retail division privately owned. That also would have given us TRUE competition (which is supposedly why it was done), instead of other Telcos needing to buy voice and data from Telstra, effectively meaning that to this day, Telstra is still a monopoly.

    What a joke.
    Ramrunner-5dd3e