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ACCC: Telstra split is needed

15 06 2009 – THE AUSTRALIAN Competition and Consumer Commission (ACCC) has told the Federal Government the structural separation of Telstra is essential to its planned $43 billion national broadband network.

But Telstra in its submission to the Government’s review of telecommunications regulation argues that no further separation of its operations is necessary as the new network, which will be wholesale only, would deliver structural separation.

Communications Minister Stephen Conroy yesterday published more than 120 submissions, which he said supported the Government’s conviction that regulatory reform was "urgently required" in the sector.

Telstra’s submission is conciliatory in tone, restating its commitment to "engaging constructively" with the Government on the broadband project, which it described as a "vital investment for the nation, the telecommunications industry and Telstra".

But the company’s submission rejects the need for "costly functional separation", instead suggesting "a number of practical enhancements" to tackle the concerns of other telcos about their access to Telstra’s infrastructure.

Specifically, Telstra proposes an independent technical Telecommunications Adjudicator, based on the British model, to make binding decisions to resolve equivalence and service level disputes between access seekers and access providers.

It also suggests an "enhanced price monitoring safety net" by which companies with substantial market power in a particular market that are providing wholesale and retail services would be required to provide notifications to the ACCC, which would have enhanced reporting powers.

It said it would be prepared to accept the results of an expert assessment of competing ACCC and Telstra models for determining the price of accessing its copper network.

In stark contrast, the ACCC argues in its submission that "structural separation is the only framework that will ensure equivalence in access during the transition phase to the NBN and is the only form of separation consistent with the type of wholesale-retail market structure the Government envisages for the NBN environment of the future."

Optus, which has called for the structural separation of Telstra, said Telstra’s proposal to replace the ACCC’s role with an adjudicator partly funded by the company was akin to a football team replacing the referee at half-time with one of its fans.

Source: business day

Vodafone Australia completes merger with Hutchison 3G Australia

10 06 2009 – Vodafone Group Plc and Hutchison Telecommunications (Australia) Limited (HTAL) have received all necessary regulatory and shareholder approvals to merge their telecommunications businesses in Australia. Following this, Vodafone Australia Limited has merged with Hutchison 3G Australia Pty., Limited (H3GA).

image Hutchison Australia issued a statement this morning via the Australian Stock Exchange detailing the transaction. Vodafone Australia will now become a wholly owned subsidiary of Hutchison’s Australian operations, which itself will be renamed VHA Pty Limited.

The Australian Competition and Consumer Commission (ACCC) late last week opted not to oppose the merger on the basis that long-term competition between the two was not sustainable.

The merger will see Nick Read, chief of Vodafone’s Asia Pacific and Middle East region appointed as chairman of VHA, while Nigel Dews, chief of Hutchison Australia, will become CEO of the new entity.

While the Australian Telecommunications User Group said "it regards the potential loss of Hutchison pressure in this market as very negative", the view of the merger from competing mobile provider Optus was more upbeat.

Last week, Optus chief executive Paul O’Sullivan agreed with the ACCC’s decision that over the long term the two companies’ operations were not sustainable, but issued a threat to the new entity. "I’ll promise that we’re going give the new guys from Vodafone a really exciting and interesting welcome," he said at a TransTasman Business Circle briefing last week.

Optus is also yet to enter discussions with VHA about what will happen with the network it owns together with Vodafone. "At this stage we’ve made no definitive decision on network. We expect to be able to engage in the next few months to get a good outcome," said O’Sullivan.

Source: Zdnet.com.au

Video: The Australian NBN reaction

08 04 2009 – video Australia: Earlier this week, the Federal Government terminated the National Broadband Network tender process with no winner, instead flagging plans to invest billions in building its own fibre-to-the-home network to 90 per cent of Australians over the next eight years.

What does the everyday person on the street think of the Federal Government’s plans to build a $43 billion National Broadband Network?
view video:

Source: ZDNet Australia