If Britain, Europe and now New Zealand are anything to go by in the Telecommunication’s Industry, then surely it might nearly be curtains for Telstra as a vertical integrated company? In the latest structural separation of a monolithic telecommunication’s company, Telecom New Zealand has finally gone under the hammer for a three degree separation. The effect of this is meant to make Broadband Internet access cheaper for the consumer and grant ISP’s easier access to Broadband networks thus pushing competition, efficiency and paving the way for a stronger economy.
Vertical integration is almost a term of the past when it comes describing dominant telco companies. The irony behind the rise and rise of Telstra as Australia’s Goliath telco is the possible demise it now faces, or should I say ‘separation’. It appears that the only option left for the Government is to follow the lead of overseas constituents by dividing Telstra into retail, network and wholesale divisions. The Kevin Rudd led charge hasn’t got too many options left up their sleeve, and considering the quagmire of the telco industry as it now stands today with numerous anti competitive claims, law suits, exorbitant prices etc.., it just make sense to separate. Is there a choice? As either caging Telstra or separating them will still lead to endless courtroom battles of litigation anyway. The latter part of 2008 will certainly bare some interest whatever the case may be.
