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Australia's largest telco to be split
Pie Pants writes "Australia's largest telco company, Telstra, which is also half government-owned and controls most of the telecommunications network in Australia, is to be split into separate retail and wholesale arms. This means that the wholesale side of Telstra will have to sell the network to the retail side under the same terms it uses with other communications companies. The government has done this in a bid to improve communications service in regional Australia, so it can privatize the rest of the telco. This is a welcome move by many after Telstra was accused of taking advantage of its network against competitors."
About time this happened. From looking at other countries with a similar solution, this seems to open the broadband market wide open for end-users (referring to sweden, where my understanding is that things work in a similar way)
I've seen it happen in my native country, Hungary, when a monopoly telecommunication company was split up this way.
The ISP arm ends up swallowing loss and unfavorable conditions while milking the consumers, and passes the revenue to the telco arm. This makes competition have a very hard time and the government ends up shrugging. Do not have a false sense of success just yet, dear australians. This won't work and your government knows that.
It takes a man to suffer ignorance and smile
Be yourself no matter what they say
Please also inform the New Zealand Government about this plan. Although in our case the monopolistic Telco would be better split into about one million pieces. Thanks.
They telco will not be broken up into regional companies and forced to compete with one another. Of course the billions of dollars the government receives from the sale won't be going into my pocket or the pocket of any other Australians who have supported it through taxes all these many years. The money will most likely go into the national surplus where it will stay. This, apparently, has some positive effect on the reduction of interest rates. Which has been shown to be a major contributing factor to get the home owners of Australia to re-elect the current government.
How we know is more important than what we know.
This move toward privatisation is something I'll never understand.
Australia has plenty of 3rd paty telcos at the moment. Not enough to cause the wide-scale state-to-state confusion that apparently pervades the US, but enough to provide choice if you want it.
While the idea of creating a wholesale and retail arm will hopefully provide better service for the 3rd party telcos (Telstra owns most of the broadband backbone here) it still mystifies me as to why the goverment would divest itself of an organisation that actually makes a profit, particularly since in doing so they pretty much guarantee rural services will run into problems as soon as no-one's watching.
The Australian government would do better to keep the wholesale part of the business and sell the retail part. Forcing Telstra to divide itself only internally will lead to a situation where they can sacrafice the retail sales but make a killing on the monopoly wholesale business. Screwing customers for all they can. Once the compay is in private hands there will be little the government can do about it.
I thought this sounded like too bid a news story to not have heard about.
Read the article. It doesnt say it will be split, it talks about rumors that a split might have been approved by the *cabinet*, that means the bill probably hasn't even been written yet, even if you assume that the rumour is true.
Thats not to say it wont happen at some time in the future, but at the moment its just speculation, and the title of the story is grossly misleading