commentary Paul Budde isn't likely to be on Telstra's Christmas card list this year. In an interview on BTalk today he describes the telco's behaviour as "arrogant" and "unique in the world". In an interview with Phil Dobbie, posted on BNET.com, Budde says that the telco's dominant position makes it feel as if it were "above the law".

According to Budde, the threat of a structural separation of Telstra is the only way to get the telco talking with the government, the regulator and industry partners about Australia's broadband future. Budde points to situations in the UK, France, the Netherlands and New Zealand where the industry has worked together to resolve issues around communications infrastructure development. Here, he says, Telstra is just too dominant to see the need to negotiate.

Although Budde says structural separation doesn't have to happen, the threat that it could be introduced has to exist. "It's the biggest stick the government has," he says.

Telstra, of course, claims there is no need for separation. Phil Burgess, Telstra's group managing director, recently referred to BT in the UK as a "basket case" since separation was forced on the company two and a half years ago. Budde retorts that's simply not true. "Telstra is telling all these stories that are bordering on the edge of lies," he says.

Budde would like to see the Rudd government delay tenders for the new broadband infrastructure while new powers are introduced enabling the ACCC to enforce structural separation on Telstra when and if it is needed. Obviously this regulatory change would need to be made before tenders are submitted so bidders would be able to understand the environment they would be operating in. "There is a significant hope that this government is prepared to make tough decisions," he said.