| An inconvenient truth: there is no level playing field |
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| by Stuart Corner | |
| Tuesday, 31 July 2007 | |
  
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The following day it was CEO Sol Trujillo's turn, addressing an AIIA lunch in Sydney. His address was unadulterated propaganda for Telstra and in particular for Telstra's desire to get the regulatory environment it wants before it will rollout its proposed FTTN network. Trujillo closed by calling on his audience to "speak out and engage," and spelling out what he called "the other inconvenient truth," saying: "it's decision time - and every day of delay and inaction on broadband policy builds a millstone around the neck of Australia's future." You cannot regulate your way to the future-you must let the market work." I agree, but another inconvenient truth is that the market cannot work without regulation when one dominant player controls key bottleneck infrastructure on which that market depends, or is simply so dominant that significant competition cannot emerge without regulatory protection. Half the time Trujillo was calling for removal or regulation so Telstra could get on with the job and the rest of the time, giving exactly the reasons why it cannot be allowed to do this. "I believe Telstra operates as the central nervous system of the economy," he said. And, after giving a list of applications that would require very high bandwidth broadband networks, saying "only Telstra has the networks to manage this traffic...Only Telstra is evolving into an integrated media comms company with a plan specifically for Australia." That sounds paternalistic or monopolistic, or both, but it simply acknowledges Telstra's unique and powerful position in the Australian telecoms landscape. And while Telstra is able to exercise this power in every facet of the market while controlling access to underlying infrastructure, the market, unregulated, will not work. The only workable solution, long term is for the infrastructure to be quarantined from the rest of Telstra's operations and for access to it to be made available equally to all by an impartial manager. That is the real inconvenient truth, and it requires a major policy change. As Sol says, every day of delay and inaction on broadband policy builds a millstone around the neck of Australia's future." Unfortunately I do not see this millstone being removed anytime soon.{moscomment} |
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