Telstra, Australia's incumbent communications service provider, has been given an ultimatum by the Australian government: either cease to be both an owner of and service provider or face forced functional separation.
If it does not act voluntarily to break itself up into two new companies--one providing wholesale access to all retailers while the second firm is limited to retail operations, Telstra will be forced by a proposed law to do so by government edict.
Communication Minister Stephen Conroy has introduced legislation that, if implemented, will separate Telstra's network operations from its retail sales and marketing.
According to the proposed legislation, Telstra will have two choices about the structural separation.
It can create a new company and transfer its fixed-line assets to that company, or it can move its fixed-line traffic to the new national broadband network and scrap its existing access network. Telstra, in other words, would have to strand 100 percent of its access assets.
If Telstra does not agree to voluntary structural separation the bill provides for forced functional separation. Under the forced separation plan, Telstra would be required to conduct its network operations and wholesale functions at arm's length from the rest of the company; provide the same information and access to regulated services on equivalent price and non-price terms to its retail business and to non-Telstra wholesale customers; and put in place and maintain strong internal governance structures that provide transparency for the regulator and access seekers that equivalence arrangements are effective.
No comments:
Post a Comment