Telstra opposes structural separation plan
Telstra has opposed the Australian government's plan to split up the incumbent operator, stating that forced separation would cost up to A$1.2 billion (€737.2 million) to implement.
The operator has told a Senate inquiry into the proposed new legislation to argue that it would reduce competition and destroy value for the 1.4 million Telstra shareholders.
The new laws would impose functional separation on Telstra if it does not do so voluntarily and enables regulator ACCC to set prices for access to Telstra’s network.
“While Telstra continues to support the Government's vision for the National Broadband Network (NBN), we believe that this bill is unnecessary and makes it harder for the government to achieve its objectives,” CEO David Thodey said.
If separation were forced on Telstra, the company would be forced to divert resources away from migration to the NBN, the submission argued. This would reduce infrastructure investment and delay the project.
It claimed that the local telecom market was already highly competitive, with 172 licensed carriers and 670 ISPs.
But telecom industry group the Competitive Carriers' Coalition (CCC) has urged the government to pass the new laws, in particular the proposal to grant regulator ACCC new powers to set regulated pricing and access principles.
The group's submission said the new powers could help boost market competition, but that the provision allowing operators to negotiate their own access prices could be open to abuse by Telstra, the Sydney Morning Herald said.
Telstra said that the ACCC’s new powers would be “unparalleled in any other industry,” and that exercising them could lead to market instability and hamper growth.