Competition imperative for NBN success says anti-Telstra lobby group

Government’s NBN expert panel snubs seminar. British, Dutch models illustrate how to foster telco competition, structural separation.

Jilles van den Beukel from Dutch telco KPN also presented at the event, talking about how KPN as an incumbent has welcomed competitors onto its network and joined them in construction of a fibre network.

Forman said strong competition between cable networks in the Netherlands is due to KPN's realisation and embracing of the fact that they can gain more value from their networks by getting as much traffic as possible onto it.

"And the best way to get as much traffic as they can is to have a lot of people trying to compete for the attention of end user customers. Their attitude to competitors, even though they are a vertically integrated company, is very very different to Telstra's in that they actually welcome and want to work with their competitors as much as they can," he said.

KPN's joint venture with another company to build and operate a fibre network proved that a vertically integrated incumbent could embrace competitors at the same time as being structurally separate from the building of a fibre-based network.

"Telstra tells us a lot the things that can't be done in terms of ownership arrangements and separation of ownership of parts of the network, and yet here are examples of it happening," he said.

CIE's Barwise agrees, finding it particularly interesting that incumbents in Europe had adapted to the issue of separation between wholesale and retail in a manner that was pro-competitive and more neutral for competition.

His comments come just days after the ACCC admitted to a Senate Committee that operational separation legislation introduced in 2005 to control anti-competitive behaviour by Telstra has failed.

"You can separate [wholesale from retail] and there are benefits from doing it. The Dutch, the Danes and British are good examples and have found that there is value in doing that."

He said the ability to move to a structurally separate and non-discriminatory regime came once the incumbent realised that its competitors were actually its customers.

"That is a moment of realisation that is yet to happen here in Australia."

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More about Australian Competition and Consumer CommissionBT AustralasiaKPNMacquarie BankOECDOptusTelstra Corporation

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