G9 pesters public for Telstra break-up

The G9 consortium has launched an online petition to compel the Federal government to include a structural separation component as part of the incumbent's contract — should it win the bid for the national broadband network.

Spearheaded by Optus, the Fair Go Broadband Web site went live yesterday in a busy 24 hours for the consortium, which appointed former Soul CEO, Michael Simmons as managing director of its bid for the national network.

Optus CEO Paul O'Sullivan

"I have been public in stating Optus's position in relation to the government's guidelines; that is, to provide consumer safeguards, a number of measures need to be incorporated into the tender process such as structural separation," said Optus CEO Paul O'Sullivan in an internal memo to staff ahead of yesterday's launch.

"This would ensure that the owner cannot discriminate in favour of its own retail division when it comes to pricing and service levels provided to other retail service providers," he said.

O'Sullivan went on to state a number of other measures — including wholesale access pricing and an extension on the tender submission process — deemed necessary by the G9 for a fair bidding process and competitive environment after the networks completion, should the bid be won by Telstra.

"Without these measures, we run the risk of a return to a monopoly market in the broadband industry, resulting in much higher broadband prices for all of us and the inability for Australia to unlock the true benefits of broadband," said the Optus CEO.

A G9 statement outlining its position on the Fair Go Broadband Web site claims "there is a clear and present danger that in its rush to roll out the national broadband network, the Government will give away critical competition and consumer safeguards".

The launch of the site coincided with Telstra's response to G9's Michael Simmons' remarks yesterday, when he described network details handed over by Telstra to competitors at the behest of the Federal government as "next to useless".

"How would they know?" a Telstra spokesperson told AAP.

"Only serious bidders can access the information and to our knowledge, they have not put AU$5 million on the table," the spokesperson said.

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Talkback 12 comments

  1. Kindergarden stuff. Sydney Lawrence -- 14/05/08

    Please all go to "fairgobroadband" and observe the childlike creature that G9 present. If their Site is an indication of their abilities to build the NBN God help Australia.

    1. Great site Davo -- 15/05/08

      Its great to see the separation of Telstra becomming a public discussion at long last. Bring it on!

  2. It won't do anything Lord Watchdog -- 14/05/08

    As much as Telstra's customer service levels leave me disappointed, breaking the company up into bite sized chunks that can be swallowed by foreign companies is definitely not the answer.

    1. Agree 100% Aaron Saunders -- 14/05/08

      To have a company that is ripe for the taking is not in the best interests of anyone except cashed up overseas companies.

      We should have a clear dividing line between retail and wholesale components of Telstra but based on what I know of the current structure it is equally important to allow Telstra to finalise their transformation process to enable this in a coherent manner. We have seen foreign companies do this too early and get destroyed in the process.

      From all indications they are preparing for this in the changes being made from within and we can all expect to continue to see a single ASX listed Telstra although truly separate operational Telstra in the next 5 years.

      Their customer service will always be a sore point with many, this is the nature of any infrastructure provider be it utilities, transport and services but it is still ma major improvement on past years and is sure to improve in coming years.

      I was compelled to write something. It's not that often Lord Watchdog says something so agreeable.

  3. Testra Anonymous -- 15/05/08

    A monopoly is bad, hurts competition, keeps costs high, keeps innovation and development restricted. It boils down to either lack of broadband for australians (as we have now) or extremely low standard of broadband technology compared to other first world nations as far as costs, speed and coverage.

    I'm not looking forward to Australia if Telstra keep their grip on Australia for the pure motivation of profits for their shareholders at the expense of the Australian people

    1. It's been discussed before Lord Watchdog -- 15/05/08

      To enhance competition you need to involve more players, not cut the existing players down. Every company has the right to expand and improve their prospects, no matter who they are but providing their business practices are fair.

      I think Telstra is an arrogant company but to cut Telstra up doesn't make sense. If the rights to build the new broadband network went to a non-Telstra player then you would finally get the competition you want, given that KRudd doesn't want to ensure that the fibre network is any faster than copper.

    2. What Rubbish!!!! Anonymous -- 15/05/08

      yeh...poor little Singtel/optus..and Big Bad Telstra....keep pushing the myth for your own disengenious gains!!!

  4. Be careful what you wish for M@TT -- 15/05/08

    So split Telstra into Infrastructure Delievry and Retail/Wholesale sales.

    This will not guarantee a single price to all consumers from the Infrastructure Delivery Group unless the licence conditions mandate this.

    They shoudl also mandate a majority Australian ownership - because it would be prize takeover target - if only for the value of all the copper under the ground and in the air - that will be replaced by fibre (wish I was a second hand metal trader)

    We still have the same problem - what is the real cost of maintaining the current infrastructure and building for the future???

    The infrastructure group will put a cost on it - and the consumers (now including Telstra retail) will all argue it is too much. ACCC here we come again.

    In the end - somebody must own and manage the infrastructure - and put a cost on it - which covers maintenance costs and future investment / expansion / new technology costs.

    Nothing changes.

    Ho Hum

    1. Nothing changes? Simon -- 15/05/08

      Actually, everything changes as you would no longer be able to accuse Telstra of unfair business practices. Access to the local loop would be consistent for all SPs and there would be no reason for the new organisation to block exchange facilities.

      The new organisation may overcharge but I am sure regulators would be watching closlely.

      My view would be that this would only work if nationalised, privatised monopolies do not have a good track record.

    2. What would all those complainers do Anonymous -- 15/05/08

      That could never happen, Groups such as Internode, Singtel Optus, G9, James Bell, Lord Watchdog and others would not be able to complain and would have to get a life and down to learning how to run a business instead of talking about why they can't.

  5. Break up OPtus Anonymous -- 15/05/08

    I think on the same note that Optus should break it's broadband Internet from it's phone services and stop bundling the two products together. It's a disease that's been spreading for too long. Product separation would be good. I can't see anyone doing that.

    Why hasn't Optus installed fibre to my house yet? To expensive? They don't want to maintain it? They can borrow someone elses infrastructure cheap? Hmm I wonder.

    I'm sure that Telstra has already had ACCC regulatory constraints put on them that separates their Wholesale and Retail operations internally anyway. The two departments aren't even allowed to talk to each other. I know, I've tried asking questions about a wholesale service on the phone whilst talking to their retail side. It just doesn't compute.

  6. Check the power.. Anonymous -- 15/05/08

    Just look at power companies. They have split them up in Western Australia and Victoria and want to do the same in NSW... it's already been proven that separation doesn't benefit the end consumer.

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