Celebrating 20 years of telecoms competition

Stuart Corner
Thursday, 22 May 2008 06:53

Opinion and Analysis

Twenty years ago this Sunday the Hawke Labor Government set in train legislative changes that, in less than a decade, ended a century long history of provision of telecommunications services by government owned monopolies.

It was on 25 May 1988 that communications minister Gareth Evans released his landmark statement: "Australian Telecommunications A New Framework. While the industry tends to celebrate 1 July as the anniversary of 'full deregulation' on 1 July 1997 when the Telstra-Optus duopoly ended, that event is in many ways less significant than 25 May 1988.

That May statement was the first commitment by any Australian Government to what the telecommunications industry in Australia had been clamouring for throughout the best part of the previous decade: major reform embracing creation of a regulatory body independent of the government-owned monopoly carriers - Telecom Australia and the Overseas Telecommunications Commission (OTC) - and the introduction of competition into the provision of telecommunications services.

The legislation that flowed from that statement created a new body, The Australian Telecommunications Authority (Austel). It also permitted an increased level of competition in value added services and customer premises equipment and formalised the definition of what was and what was not a value added service.

In a separate initiative, Telecom Australia and OTC were transformed into fully corporate bodies subject to corporations law, with boards of directors and with all shares held by the government: an essential prerequisite to the subsequent partial, and later full, privatisation of Telstra.

No one really expected that Telecom's monopoly over the fixed telephone network would be relaxed, but there were high hopes that mobile services would be opened to competition. (At that time cellular mobile telephone services were very new in Australia, Telecom had launched its analogue AMPS service only in 1987). These hopes were not fulfilled: the government decided that Telecom should retain its monopoly over cellular, but promised to look at the question of awarding a second licence.
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