Stan Beer
Sunday, 24 May 2009 11:40
Opinion and Analysis
Page 2 of 3
For Samuels and the ACCC, vertical integration of Telstra businesses in any form is anathema and functional separation is not strong enough to prevent its market abuse.
That includes the delivery of entertainment content over the Telstra HFC network via its part ownership of Foxtel.
"The government’s discussion paper raises a number of concerns regarding Telstra’s ownership of the ubiquitous fixed line copper network and thelargest HFC network in Australia, along with a 50 per cent stake in Australia’s principle pay TV provider, Foxtel.
"In its discussion paper, the government also raises the option of forcing Telstra to divest the HFC network. Indeed, doing this would introduce a new infrastructure-based competitor into the telecommunications sector.
"It could also address some of the concerns arising from Telstra’s stake in Foxtel as well as its control of the principal pay TV network."
Once again, the last sentence leaves little doubt about what the ACCC would like to see. In fact, it positively reeks of a call for structural separation of Telstra's ownership of the content delivery pipes (HFC) and the content provider (Foxtel).
Predictably, Samuels' speech has many of the more than one and half million Telstra mum and dad shareholders pervading the blogosphere up in arms. The general tenor of their outrage is that when they bought into Telstra via the government's share offers they believed they were buying a monopoly.
However, few have commented on the fact that the share price of their much vaunted monopoly has been plumbing the depths for quite some time and earnings are flat.
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