Australian TelCo Required To Grant Loop Access

David. H. Sims writes "Well as it seems Telstra, Australia's telephone monopoly has finally been recognized as one, the Australian Competition and Consumer Commission (ACCC) has forced Telstra to grant full local loop access to its competitors and to bring extensive testing to a halt and begin the mainstream ADSL rollout by August at the latest. If you don't live in Australia, Telstra is the only reason we're all stuck to poor modem speeds, Telstra owns all exchanges in Australia and is privatised and thus wouldn't open them to other companies so they could install the relevant ADSL equipment. As usual the full story's at NewsWire. I think I'll have my xDSL medium rare! :) "

Comments

The Better Solution to Telstra's Monopoly.

[Jacques Chester]

To bring you yankees, poms, euros and others up to speed, the Australian federal government is hell-bent on selling Telstra in order to help pay off some of the national debt.

This has already led to a great deal of controversy. Telstra has been accused of reducing services to remote areas, and of predatory, monopolistic practices. The solution offered is a system of regulations, laws, and fines. IMO, this is stupid. There is a much simpler and more elegant solution.

One: Keep the hardware.
Two: Sell the rest.

The Network is the source of Telstra's monopoly power. It owns the Australian phone network, top to bottom. Competition in Australian telcos roughly boils down to who can pay Telstra more.

That network - bequeathed to Telstra for free - was paid for by the Australian taxpayer, an investment of billions. Telstra could not afford to pay to build that network itself. Nor could any company on an "expected returns" basis. But because the network has already been paid for (by us), Telstra gets it "for free".

I say that we keep the network and sell the rest of Telstra. Sell its customers, support centres, business ventures and staff; but keep the part *we* paid for.

So how do we manage this network, if we keep it?

We turn to the market to handle it.

We have, say, x Gigabits of data capacity inherent in the network. I note that the Australian system, once you hit an exchange, is fully digital. Voice and data are all the same thing.

We issue - quarterly, say - "bandwidth bonds". A bandwidth bond entitles the holder to a certain percentage of network carrying capacity over a certain time period.

To prevent speculatory activity, you'll need a rudimentary registration to enter the market. After that, anyone may buy, sell or trade units amongst themselves. This means that Telcos need not buy bandwidth from Telstra at inflated prices in rigid blocks, they buy exactly as they need. They need more? Buy some off the market. Bought too much? Sell back your excess capacity.

This also means that firms can buy their own capacity directly. ISPs, businesses with large phone and data networks ... hell, even a street of people could get together and form an access co-operative. All possible with a working bandwidth market.

The sale of Telstra is going to create more and more of these legalistic, top-heavy solutions. This is why we need to take away Telstra's monopoly basis.

Well, that's my two Australian cents, anyhow :)

be well;

JC. (note that USYD is a .edu)

--