Competition or no competition, that is the answer! The deconstruction of Telstra as a vertically integrated Telecommunication company could be nigh as the push for it’s structural separation gains momentum. In a report released by ‘Competition Economists Group’, who were commissioned by Telstra’s arch rival Optus, key findings suggested that Telstra (if not structurally separated) would have very powerful incentives to damage competition in the Telecommunication Industry if it were to win the National Broadband Network bid.
As reported back on April 1st, the Structural Separation of monolithic Telco companies in the UK, Europe and now New Zealand are solving anti competition dilemmas. But what about Telstra and it’s shareholders? Well it seems that conjecture and speculation cause investors to be weary and that structurally separating Telstra into retail and wholesale divisions could actually ease the uncertainties behind Telstra’s future and restore or even improve market confidence.
“This means that if the NBN is owned by a vertically integrated Telstra, then discrimination — and damage to competition — will be a much bigger problem under the NBN than today.”
Today’s report is expected to be the first step in a concerted campaign led by Optus to lobby the Government for a forced split of Telstra.
source: news.com.au
