Government To Force Telstra To Structurally Separate

Government To Force Telstra To Structurally Separate

The big Australian tech news of the day (and arguably of the year) is that the government plans to force structural separation onto Telstra, meaning that it will be forced to essentially hand over its control of the existing national telephone network (including ADSL). Like the NBN, the arguments over this will be huge, and there’s not likely to be any noticeable difference for the average consumer for quite some time. We’ll look into the implications when the dust settles, but meanwhile you can read the announcement on the DBCDE site.


  • This is good news but from what I know of Telstra there is still one way in which they could potentially screw Australia.

    The Next G network is far superior to Optus, Vodafone or 3’s 3G offerings and is the only realistic option for anyone wanting to conduct business outside of major cities. Telstra knows this and its charges are very high.

    Now, Telstra must have put considerable investment into this network and so the costs should reflect the scale of the investment, but I wouldn’t mind betting that Next G is a lot less profitable than the regular old copper land lines.

    How many people do you know who go with Telstra for their home phones just because they always have done? Telstra charge a lot more for their ADSL and home phone products than the competition despite having had the majority of cables laid for them when they were formed. Companies like AAPT have laid their own network yet undercut Telstra.

    My fear is that if Telstra lose control over the copper-wire network, then they will have to recoup costs elsewhere and this means upping charges for Next G services — a move which would impact regional Australia.

    Now I’m no fan of Telstra at all but if they are to retain ownership of the Next G network then the cost to regional Australia could be high, but I doubt the Government could legally request that they hand over something that was built since their formation.

    Perhaps another commenter can shed more light on the status of Next G and which side of the split it is likely to land on?

    • This may be the case “I doubt the Government could legally request that they hand over something that was built since their formation.” but their formation was also as a goverment owned entity. Therefor it was goverment money that built the network. Something that Howard should have thought of before selling it off.

  • this is fantastic news, as I see it.

    the impact to regional customers will not be felt for many years, as the projected roll-out of the NBN is planned to take until around 2016-17, (incidentally it will leave customers on today’s equipment for dead).

    some interesting ABS figures: as regional australia makes up more than 30% of the population and the FTTH is planned to cover 90% of that figure, there’s still a couple of million people left unaccounted for; but with only ~75% of us regularly using computers at this point in time, many of these people will still not be using computers or the internet at that point, diminishing the numbers of those left out of the NBN.
    further, there’s the fact that anyone using Telstra’s NextG is not depending on any kind of high speed access — it’s so unbelievably patchy and unreliable even in the best coverage areas, it barely reaches ‘broadband’ speeds, and the cost prohibits only very occasional users (so farmer max surfing video porn sites from his combine harvester is probably not likely).

    the risk I foresee is the fact that this is such a long term investment, it will take another two terms of government to complete, and in that time it’s quite possible the conservative coalition might return to power, and dump the billions already spent on the NBN in favour of a new upgraded copper network (it’s easy to imagine for those following the recent Workchoices-revival-under-another-name discussions in the media).

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