The Federal Government will restrain Telstra's dominance of the telecommunications industry with new rules to promote competition in the sector amidst fears smaller service providers face ruin.
The Federal Government's strategy for making the telecommunications industry more competitive will restrict Telstra's ability to subsidise its retail arm through its wholesale division and its ability to appeal regulatory decisions.
Telstra will be forced to make prices it charges its retail division and its wholesale customers more transparent and the the two operations will be divided under separate accounting schemes. The Australian Competition and Consumer Commission (ACCC) will also be required to publish prices and benchmarks it uses to make its regulatory determinations.
The new rules should be welcomed by small telecommunications and network providers that rely on Telstra's core network facilities.
Ash Chopra, general manager of one of Telstra wholesale's customers, Internet provider iPrimus, said that the move is "step in the right direction".
"I think it's one of the necessary steps in adjusting the rates between retail and wholesale that needs to happen," Chopra told ZDNet Australia. "It's going to make inter-connection fees and even the cost of wholesale copper come down to better reflect the true value of the service."
Telstra is saying little until it evaluates the impact of the new rules but a spokesperson for the company said that it accepts the decision and it will work with the government on the matter.
However, it has admitted to being "bemused" by the decision to remove the right to appeal ACCC decisions.
About bloody time !!!!
There is no competition until the Retail/Wholesale arms of the T(H)elstra monopoly are totally seperate operations with totally transparent pricing and unable to constantly attack the ACCC causing months of delay or no compliance with ACCC decisions.
I wonder how long it will take the good senator and our greedy (read..overpaid) feds to implement the changes. I certainly won't be holding my breath.