By Alessandro Mauro
To submit comments and updates: alessandro.mauro@telecomitalia.it
In 2006 a form of functional separation was introduced in Australia: within the incumbent operator Telstra, a separate wholesale department responsible for the selling of wholesale services to the other licensed operators was set up. Nevertheless, the results obtained in terms of an improvement of the competitive conditions in the market were not in line with the expectations.
For several months talks continued between the government and Telstra about the possible separation of the incumbent's access network, but no common position was reached.
In May 2010 the Australian government released a study prepared by McKinsey and KPMG regarding the implementation of the National Broadband Network (NBN), containing recommendations on technology, financing, ownership and market structures for the NBN. According to the report, the involvement of Telstra was not necessary to build the new network. The report also recommended the government to maintain the ownership of the new network.
Following the release of the report, a public consultation on this issue took place, after which the government took some important decisions, which led in June 2010 to the definition of an agreement with the incumbent.
The main points of the agreement were the following:
- Migration of Telstra customers to the new public fiber network NBN (National Broadband Network);
- Disposal of the old copper network;
- A government contribution to Telstra of € 7.5 billion as a compensation for the opening of its access network and the migration of its customer base to the new one.
The "historical" transition from a copper network to a fiber network began: after a year of difficult negotiations, Telstra signed an agreement with the government to implement the new 100 megabits per second network (for a cost of € 30 billion) that will reach even the most remote locations in the country.
In February 2012 the final agreement for the structural separation of Telstra copper access network was reached; Telstra receive a state payment of about 11 billion Australian dollars as a compensation for the access granted to its pipelines and the progressive migration of its customer base to the new NGAN.
NBN Co, a company founded in 2009 by the government, is in charge of the roll-out of the new network. It also committed itself with the Special Access Undertakings for the technical aspects related to the implementation of the new network and the supply of services to Operators.
Telstra will rent the NGAN services under the same terms and conditions of the alternative Operators. Over the last few months agreements between NBN Co. and various Operators for the use of the NGAN network are being finalized.
Details of the agreement are contained in the Telstra Structural Separation Undertaking and Migration Plan. An Independent Telecommunications Adjudicator (ITA) in charge of ensuring a quick resolution of disputes that arise between Operators was also set up.
One of the main consequences of the changed Australian regulatory framework is the end of the Universal Service obligations upon Telstra.
For more information:
http://www.accc.gov.au/content/index.phtml/itemId/1003999
http://www.accc.gov.au/content/index.phtml/itemId/1043715
http://www.nbnco.com.au/getting-connected/service-providers/sau.html