The nation's number two telco Optus said today it still
wanted Telstra's wholesale and retail arms separated from each
other, and hadn't noticed any change in the company's stance
towards its rivals in recent times.
The comments came as Optus general manager of regulatory affairs
Andrew Sheridan briefed ZDNet.com.au on his company's
response to the Federal Government's review into industry
regulatory changes, which could accompany the $43 billion National
Broadband Network project.
Sheridan noted that Telstra's approach had not changed in recent times, despite its appointing what many have seen as a more conciliatory chief executive, David Thodey and chairman, Catherine Livingstone. The Optus executive particularly noted Telstra's move last week to appeal an Australian Competition and Consumer
Commission (ACCC) ruling on unbundled local loop pricing.
Optus' preferred view of Telstra's future (at this stage)
would see the telco split into two separate companies, one to own
and operate Telstra's network and sell wholesale services to other
telcos, and one to sell retail services. Shareholders would exchange
their Telstra shares for equivalent shares in each company.
Another option would see Telstra simply setting up a separate unit
within its own operations to deal with the network and wholesale
side of its business. Sheridan noted the government was already
planning to implement a wholesale-only model for its planned
National Broadband Network company, and claimed that implementing a
similar model across the industry prior to the NBN's establishment
would benefit the industry.
The other planks of Optus' regulatory submission will focus on
forcing Telstra to provide access to services to rivals on "truly
equal" terms as it does its own retail businesses, new pricing
rules for wholesale services and stronger powers for the ACCC.
In general, Sheridan said Optus' submission was designed to
obviate what he described as the "market failure" of the current
regulatory regime, due to what he claimed was an overly dominant
position by Telstra by virtue of its vertically integrated
The problem mainly applied to the fixed-line sphere, Sheridan
said, with the mobile sphere having found more success with fuller
infrastructure-based competition since the telecommunications
industry was de-regulated in 1997. "If the policy-makers were still
around 12 years on, I doubt they would say their policies were
successful," he said.