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Feds outline Telstra regulatory options By AAP April 11, 2005 URL: http://www.zdnet.com.au/news/communications/soa/Feds-outline-Telstra-regulatory-options/0,130061791,139187868,00.htm
 The government will investigate whether it needs to overhaul the competition regulations for telecommunications companies ahead of the full privatisation of Telstra. Communications Minister Helen Coonan today launched a discussion paper outlining the options it is considering. "Examining these issues is the key to ensuring there is effective competition and future investment in telecommunications in Australia over the next five to 10 years," she said. The government is still opposed to a structural split of Telstra's wholesale and retail operations. However, it has softened its view to some form of operational separation. If Telstra splits its retail and wholesale operations into two different businesses, competition is expected to improve and deliver benefits to consumers and businesses. The regulatory discussion paper comes on top of a scoping study into the possible sale of the government's majority stake in Telstra. Submissions to the departmental inquiry can be made up to May 5. The inquiry will consider issues such as whether operational separation is justified and what impact it would have on competition. The discussion paper said arguments for some type of operational separation included suggestions it would increase the transparency of Telstra's network, retail costs and operational costs. "(It would) improve the ACCC's ability to investigate and identify possible instances of anti-competitive conduct by Telstra," it said. "In turn, it has been suggested that this would enable Telstra's competitors to have greater confidence in the enforceability of the existing regulatory regime." The government will also look at accounting separation rules Telstra currently operates under, and how they would function if a form of operational separation were to occur. Also under examination is whether current regulatory settings provide enough incentive for telcos to invest in next generation networks. "The potential benefits arising from the deployment of such networks over the next few years makes it important to ensure that investment in these networks continues into the future," the discussion paper said. The latest competition inquiry coincides with a Senate hearing this afternoon, chaired by Australian Democrats senator John Cherry, into the performance of the regulatory regime for the telecommunications industry.
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