Government foreshadows major telecoms regulation reform

Stuart Corner
Tuesday, 07 April 2009 06:50

IT Industry - Strategy

The Government has foreshadowed the biggest reform of telecommunications regulation in more than a decade as part of its revised plans for the national broadband network, and has set out a series of radical proposals in a discussion paper.

On the table is a full functional separation of Telstra into wholesale and retail units, along the lines of Telecom New Zealand, and giving the ACCC powers to determine price and non-price terms and conditions under which other telcos access the networks and facilities of other telcos, primarily, Telstra

The last major change occurred in 1997 when the restrictions on the number of fixed and mobile network operators was scrapped and telecommunications competition regulation brought within the Trade Practices Act, albeit through a series of new telecoms-specific sections.

It has been widely recognised that this competition regime has been subject to a huge amount of gaming and that its administration has soaked up enormous resources in both the telcos and the regulator, the ACCC. It has also been the contention of large sectors of the industry, other than Telstra, that the only viable solution is to functionally or structurally separate Telstra thereby removing its incentive to game the regulations to try and advantage its own retail operations over those of its competitors that need to make use of its networks and facilities.

Much of the controversy, and difficulty, has centred around the negotiate-arbitrate regime under which other telcos gain access, primarily, to Telstra's network. The Government is considering replacing this with a new regime under which the ACCC would have power to set price and non-price terms and condition for access.

The proposed reforms also include a strengthening of current rules exempting licensed telecommunications carriers from local planning rules when rolling out networks, in order to speed up deployment o of the planned FTTH network.

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