The Government’s broadband backbone announcement today was a “downpayment” on the restructuring of the communications industry that would break Telstra’s grip over many regional communities, stimulating competition and investment, and the CCC said.

“The Nextgen Networks proposal is for a wholesale-only backbone network to many regional communities. It will provide a level playing field for retailers to offer services in the regional communities to be connected,” CCC executive director David Forman said.

“For years, successive Governments have been told by competitors that Telstra’s stranglehold on the long distance connections to regional communities was preventing them from reaching those customers.

“Quite simply, Telstra charges so much for access to those towns that competitors could not get offer services at realistic prices.

“The creation of an alternative, wholesale-only service from Nextgen changes the game. Nextgen will want to attract as many retail competitors to use its network as it can.

“CCC retail member companies have shown by their actions in the past that where they can get a fair go, they will invest to provide choices to consumers previously stuck with Telstra.

“There is every reason to think that the backhaul network announced today will see retailers quickly moving into these competition-starved regional communities.

“The whole of regional Australia could benefit from a similar change if Telstra’s wholesale and retail businesses are separated, and its transmission business is no longer linked to its retail interests.

“It is a tragedy that the Senate did not pass the Government’s regulatory reform legislation last month so that these reforms could have been underway today,” Mr Forman.

Contact:
David Forman
Executive Director
CCC Inc
0438121114