I just hope that in whatever happens here, we don’t go backwards with service due to lack of competition. Telstra has come a long way since they have had competition and I would hate for that edge to be lost.

My only other comment is to ask why we arn’t using the existing cable networks and just bumping them up to DOCSIS 2.0 or higher which will give almost the same speeds as this new fiber network. That’s what the USA is doing. I don’t understand how anyone can propose that fiber to the home is cost effective at those speeds.

Then there is the question of the backbone from Australia to the rest of the world. It’s already seriously under spec’d and if we all get faster broadband it’s only going to be slower again.

Over the last few days, I guess I’ve calmed down a bit. I can see the logic in having the govt own the copper network given the amount of competition in today’s telecommunication market.

However, I think it’s wrong that Telstra wouldn’t be compensated for losing one of its assets. Especially considering the govt made a tidy few billion dollars from when it sold its ownership in Telstra.

Thanks b too for your indepth comment about the whole explanatory “note” and how it all slotted into place. Interestingly, I don’t disagree with anything you said. I guess I’m still learning and understanding it all.

I’m looking forward to hearing more about it all as it progresses through parliament, and I’m also thankful that our internal comms team are doing a good job of explaining it to us as employees and how that affects our day-to-day job (which is nil at the moment).

I do not.

In theory the only reason Telstra got to be where it was in the first place is precisely because they were a government organisation; not bounded by the profit motive. It was managed perfectly well by the Federal Government for 96 years before it was privatised.

The difference between it then and now is that used to be accountable to we the people as voters; as a private organisation it is accountable to no-one including it’s shareholders.

The Government’s prime concern is about providing broadband services to the people of Australia, something which Telstra haven’t seriously proposed. Besides which, if Telstra as an organisation hated both the Liberal and the Labor Parties then this is not a political issue.

Exactly the same issues arose with the breakup of British Telecom into BT Group, Yell and 02.

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The US has five major 3G Networks (Sprint Nextel, US Cellular, Verizon, AT&T, T-Mobile) and although China has seven national mobile telephony companies, all of the base infrastructure is owned by the Government.

I wondered why Labor was going this way when it was the Liberals who copped it most from Telstra. But of course, it isn’t Labor, it’s the ACCC who is driving this change- and from what is in the explanatory note it sounds like the ACCC is sick of being bullied by Telstra and wants some teeth.

The goal *is* a wholesale Monopoly [in fixed line] owned by the govt and they are not shy about it:
“This approach will ultimately lead to a national outcome where there is a wholesale-only network not controlled by any retail company—in other words, full structural separation in time. Such a negotiated outcome would be consistent with the wholesale-only, open access market structure to be delivered through the National Broadband Network. However, if Telstra does not voluntarily implement structural separation, this Bill will require the functional separation of Telstra. Functional separation is a regulatory tool that has been used successfully in other countries such as the UK and New Zealand and is being considered by the European Commission, to address the underlying incentives that fixed-line incumbents have to favour their own retail businesses.” pp 3f

Funny how no one has mentioned that it has been used in the UK and NZ.
Maybe the govt is not reporting the whole story either but it is noteworthy.

I didn’t read anything in the first 40 pages about the provision of Mobile services – and I think that is cos Mobile services are quite competitive and it is due to that Competition that Telstra has moved so far ahead of the others in that area.

Plus that move was quite wise because I am sure that they saw the day coming when the fixed network was going to a) cost them a fortune and/or b) be forced to be opened up to real competition. And maybe there has been more R&D in wireless so they could see that speeds would increase in that area quicker than in wired. And of course wireless is the way to go in many cases and all the more as technology converges. But, again, I think if Telstra had the same control over wholesale access to wireless connections as it has over fixed line then why would they bother competing? Without the competition in the wireless space Telstra would not have gone for Next G.

However, as I said – this is nothing to do with Mobile – to bring that up seems to blur the issue.

And now onto the ACCC…
“…the current operational separation regime aimed at promoting equivalence is ineffective and does not address Telstra’s incentive and ability to discriminate against its competitors’, and ‘[s]ince coming into effect in June 2006 the operational separation arrangements that apply to Telstra have been shown to be ineffective in a number of essential areas.” p17

The explanatory note says, “Enforcement mechanisms for the existing operational separation regime are weak and indirect. There is no legal obligation on Telstra to comply with its operational separation plan.” p21 and “The ACCC has recently reported that competition in the Australian telecommunications market is not emerging as anticipated.” p22

And here is what Optus had to say “‘Optus complained to the ACCC that Telstra was providing higher performance standards to its retail customers than wholesale customers—for example, by routinely offering better connection times to its retail customers than to wholesale customers…Whilst Telstra Retail is able to provide connection remotely at the flick of a switch—Telstra applied a cumbersome process for wholesale customers requiring two separate technicians to visit the customer’s premises and taking several days to complete (and requiring customers to be present for both visits). ’—Optus consultant Dr Chris Doyle, University of Warwick” p19

If what the explanatory note says is true, then it sounds like the Govt wants to create a government owned monopoly supplying fixed line access – maybe, as I tweeted, that should have been the way it was when Telstra was first privatised.

As for no one else stepping in to build their own network – any new entrant has to build from scratch – Telstra started with the network in the ground and went from there. What incentive is that for someone to try and compete? Plus the, in your view, substandard, 100MB NBN is expected to cost $43 billion. That’s a lot of money for someone to find from scratch – with a decent return being a long way into the future – it doesn’t surprise me no one has done it before.

Is Telstra being bullied? Probably – but it sounds like they have had it coming to them – sadly I am not so sure the Govt could have started this any other way – secret meetings with Telstra would not go down well in the parliament or with the electorate – as far as I know, the Govt have to notify the Parliament to bring about these changes – plus with the ongoing investigations and complaints how could Telstra be caught out by this idea coming forward – from what is in the Explanatory note Telstra has resisted competition on it’s fixed line services for as long as it can and now something has to be done. The explanatory note is, no doubt, only half the story, but it does look like the ACCC has cried BULLY!! to Dad and Dad has responded with an ultimatum. Change yourself or we’ll change you.

I wonder what Rollo thinks…

1. Who else is making an effort to get more service out to regional Australia? At least Telstra has made the best effort by creating a mobile network that gives those people at least some connectivity.

2. How the hell is separating Telstra going to solve the issue of lack of services in regional Australia?!