Xenophon backs Telstra split

Independent senator Nick Xenophon over the weekend said he backed a structural separation of communication giant Telstra as long as regional Australia got a fair deal.

Senator Xenophon said the Telstra bill is the second largest piece of legislation that the senate will have to deal with after the emissions trading scheme in the final two sitting weeks of parliament this year that start in a week's time.

"It's going to be a hell of a two weeks given the amount of legislation the government wants to get through," Senator Xenophon told Sky News.

Legislation currently before parliament seeks to split Telstra's wholesale and retail businesses with the aim of rolling out the $43 billion national broadband network in an evenly competitive marketplace.

Senator Xenophon said he has held discussions with Communications Minister Stephen Conroy over the Telstra split.

"I think there ought to be structural separation (of Telstra) so long as there are adequate conditions and safeguards in place so that the bush gets a fair go and consumers get the best possible deal in terms of a new competitive framework," he said.

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Everyone wants the split! Anonymous -- 09/11/09

Everyone except greedy shareholders want a better deal with the their telco usage - its that simple.

If we are creating an artificially market for Telstra shareholders then why don't we just put them on the public servant payroll and be done with it.

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Not Everyone wants the split! Anonymous -- 14/11/09 (in reply to #320391108)

And while we are at it, let's get the Government to take over the running of Coles and Woolworths.

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Rural Australia will get a raw deal Anonymous -- 10/11/09

The reason is simple. The ULL price is more than $110 per month per customer less than the retail rental charge that can be collected in some areas. While Telstra is a single entity, it effectively pays itself this money, so the 'loss' is on paper only. Split Telstra and that loss becomes very real.

When the ULL prices were set, the ACCC most likely did not expect anyone to actually pay that amount of money. It existed merely to justify the low ULL prices Telstra's competitors wanted for the metro areas where they do their cherry picking. Like Telstra's shareholders, the ACCC would not have foreseen structural separation or its consequences (and no, although "regulatory risk" was mentioned in the prospectus, structural separation was not).

What is the solution?

First, only a blithering idiot would argue that any company could absorb this kind of loss indefinitely, so something will have to change.

It is unlikely that Telstra's competitors will move into rural Australia, so for those people, it will remain Telstra or nothing. Nothing is a possibility.

The retail price could increase. It is unlikely to increase across the board to cross subsidise rural services because it would make Telstra less price competitive than it already is.

If you can't increase prices, you could reduce services, or more specifically, use cheaper and inferior technologies.

The ACCC could align the wholesale pricing philosophy with the government's retail pricing philosophy of equality, but that would mean the ACCC admitting it was wrong and Telstra was right in wanting uniform prices, so we know that's not going to happen.

The USO prices could be increased to compensate, but as they are currently capped at an artificially low level already (approx 40-50% of the true cost), that will lead to a massive increase in costs to Telstra's competitors.

Finally, we could find a politician with enough brains to understand basic economics, realise what this will do to rural Australia, and stop the separation going ahead. I know - fat chance!

Unfortunately, like the clown who posted above, they have all fallen for the 'community interest vs shareholder interest' fairy story Telstra's competitors have successfully spread amongst the community. Make no mistake. Telstra's competitors are motivated solely by the interests of their own greedy shareholders.

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Structural Separation and ULL Robert Kennedy -- 10/11/09 (in reply to #320391175)

Hi,

The social policy issues are different from the techncial issues as are the economic issues. The trouble is that many confuse the different issues or try to use arguments about socila policy to deal with technical issues or vice versa. It remains the case that all governments created this monster with all these legacy problems and there is no beautiful, simple, elegent solution. What we do know is that CAN monopoly was and remains a problem. The obduracy of Telstra while understandable to a degree, has not and will not assist in the resolution of these complex problems that are of great importance for all Australians.

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The CAN 'problem' Anonymous -- 11/11/09 (in reply to #320391204)

The CAN 'problem' exists because in spite of nearly two decades where Telstra's competitors could have competed, for the most part they chose not to.

There are three key exceptions. May of Telstra's competitors have put their own CAN in the lucrative CBDs. Some have focused on regional areas. The biggest by far is Optus who installed their own CAN to 2.5 million homes but still choose to use Telstra because it is cheaper.

They have proven the can do it, which means that the lack of competition is a matter of choice.

Whether Telstra's partial monopoly is a genuine problem is highly subjective. Of course its competitors will claim it is if they can get the ACCC to simultaneously cripple their chief rival and backroll their own business cases.

Finally, if a monopoly CAN is a genuine problem, what does that say about a monopoly NBN?

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Rural Australia will get a raw deal. Sydney Lawrence -- 10/11/09

How refreshing to read intelligent opinion after the lunacy of the Anti-Telstra Circus and their disingenuous and self promoting three card trick smoke and mirrors propaganda.

My fear is for the Australian taxpayer that this uncosted and poorly planed FTTP will be a absolute disaster. Any plan to sacrifice Telstra to save Mr Rudd must not happen.

Not because of shareholder loses but because in Australia this blackmail of Telstra to assist a monopoly dominating business should not be allowed to happen.

Could anyone tell me how the ACCC could condone the destruction of Telstra as a competitor to the proposed NBN which would then create a monopoly without competition?

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backwards incompatability Anonymous -- 10/11/09

I care not one iota for the fiscal welfare of Telstra share holders. I would rather see instead an affordable world class telecommunication network, something that has always been within Telstra's capability to arrive at in Australia, but it keeps missing the bus. Having actually worked on Telstra's NextG project I observed a lot of waste (time, money, energy and resources), most of which being directly attributable to convoluted acts of subterfuge by over-paid and under-worked sorts manipulating the system to solidify their titles. Such inefficiency and lack of cohesiveness typically squanders any opportunity to deliver a world class and affordable telecommunications network in a timely and appealing way. I remain absolutely convinced that splitting up Telstra quickly and cleanly will benefit Australia, including those short sighted Telstra share holders who will eventually reap the rewards from the plethora of new market driven services instigated from a fast, pervasive, reliable and affordable telecommunication network foundation in this country.

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Backwards thinking Anonymous -- 11/11/09 (in reply to #320391238)

Actually you do care about the fiscal welfare of Telstra's shareholders. You are just not smart enough to realise it.

Telstra's competitors are often characterised as parasites, and indeed there are many similarities in their relationship with their host. Without Telstra, the infrastructure their business depends on disappears. Bearing in mind that under the three-way spit of the current operational separation model, Telstra's Retail arm basically pays for most of the network arm. Cut off that funding and lumber Telstra Wholesale with the full cost and see what happens to your desire for "affordable" prices.

Not only do Telstra's shareholders need it to survive, but its parasitic competitors are just as dependent on their host's survival for their own.

As for "world class", if you really did work in NextG you would know that 3G services are traditionally available in heavily populated areas only. Get out of the cities and suburbs and 3G vanishes. So thankfully, NextG is not world class.

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In reply to..........backwards incompatability Heaven Help Us -- 11/11/09 (in reply to #320391238)

"Having actually worked on Telstra's NextG project I observed a lot of waste (time, money, energy and resources)........................................"

"directly attributable to convoluted acts of subterfuge by over-paid and under-worked sorts, manipulating the system to solidify their titles."

If that is what happened with Telstra, under the managemenet of Telstra staff, I cannot imagine what it will be like, if and/or when it is eventually managed by the average public servant management staffer.

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Finally! AB -- 12/11/09 (in reply to #320391270)

hooray!

Someone who gets it. Good one Anon..

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re Finally! Anonymous -- 13/11/09 (in reply to #320391356)

Yep, but try getting agreement on that from the anti Telstra mob, and you'll find that it not only falls on deaf ears, but will simply stir up more resentment.

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anti telstra ha Anonymous -- 13/11/09 (in reply to #320391494)

anti telstra mob, ha

you mean 99% of australians, ha

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anti telstra ha Anonymous -- 15/11/09 (in reply to #320391548)

Nope, 100% of the imbecile's who frequent this forum, and you in particular.

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100% ha Anonymous -- 15/11/09 (in reply to #320391660)

100%, so you include yourself, imbecile, ha.

it least you admit it imbecile

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100% ha Anonymous -- 16/11/09 (in reply to #320391667)

Read it carefully once again you imbecile, and you just might get it right ! (but I very much doubt it.)

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ha Anonymous -- 16/11/09 (in reply to #320391786)

carefully, yes you are definitely an imbecile and the's no doubt about it.

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ha Anonymous -- 18/11/09 (in reply to #320391788)

The incorrect spelling in both of your last two posts, confirm how brain dead you are, imbecile.

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ha Anonymous -- 18/11/09 (in reply to #320392014)

spelling, ha.

i can spell imbecile look, its spelled mike

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..ha Anonymous -- 20/11/09 (in reply to #320392016)

Yeah, and I suppose we are all supposed to believe that you are not RS. What an absolute knucklehead, you are. Why don't you Get a Life, you cretinous moron.

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Shakes head.... Mel Sommersberg -- 25/11/09 (in reply to #320392180)

A leopard can't change its spots. On that note I see that Jason is still wiping the walls with his excrement.

As for the subject at hand, I've always said that I don't think that Telstra should be split up. I fail to see how it will achieve anything positive given that in a few years we'll have two wholesale networks that service providers can choose from when seeking the best deal. This alone WILL bring Telstra into line because if they choose to remain folly with their pricing and other issues then they will lose through massive attrition of customers rather than regulation.

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re Shakes head.... Anonymous -- 25/11/09 (in reply to #320392666)

Sounds logical to me. But don't expect "you know who" to accept that comment without subjecting us all to a bucket load of his nonsensical abuse. Wait for it !

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Braaaaadley, Lord Watchdog, ROFL. Guess who -- 28/11/09 (in reply to #320392666)

Little Adolf Sommersberg, aka Lord Watchdog, back at last, months after a debating lesson, which had him disclose his full life story and deepest inner secrets, ROFLMFAO. I see you again brought your spastic monkey too.

The humiliation of the obvious debating beotch slappin' he received, is etched so deeply into his psyche, he has had to take out a gym membership, to get all buff and obtain a black belt in karate, just so that he can feel safe enough to sit behind the pc at muuuumys and mention the name Jason again.

Better start on the roids and get a few dans first, crankshaft!

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