Telstra Just Can't Win In Regulatory Battles
N
N
0Overall Score

It seems that no matter where Telstra is, the regulatory regime is against them.

In Australia the company is waging a campaign against regulation that would allow competitors to piggyback off its proposed next generation network, while in New Zealand the TelstraClear subsidiary is fighting a battle to get the local loop unbundled so it can piggyback off NZ Telecom’s infrastructure.

Speaking at the Telecommunications Users Association in Hamilton, TesltraClear CEO Dr Allan Freeth bemoaned the slow pace of Telecommunications reform saying his company had recently cut services and backed away from expansion plans as a result of the regulatory situation in the country.

While admitting some progress had been made in the regulatory environment across the Tasman, Freeth said much more is needed. In particular Freeth wants Telecom to undbundle its local loop so that Telstra can access the local copper network that runs from telephone exchanges into homes and businesses. This is the situation in Australia, where competing service providers are charged a wholesale fee to gain access to Telstra’s copper.

TelstraClear points out that New Zealand and Mexico are the last remaining countries in the OECD to force their incumbent teleco to retain a monopoly with that “last mile” of copper.

According to this story, Dr Freeth said the problems with unbundling the local loop meant Telstra in Australia could be reluctant to expand in New Zealand. The company spent up to NZ$130 million a year on normal business developments in New Zealand, he said.

“But when you go to them (Australia) for the really big stuff . . . that’s when they come back and say ‘well, why would I invest here? I could go to China, India or wherever, who have much better and friendly regulatory environments’.”