Optus calls for Telstra break-up over new NBN plan

Dylan Bushell-Embling
09 Oct 2014
00:00
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Daily News

Australia's Optus has renewed the calls for its archrival Telstra to be broken up into separate companies.

The former state-owned operator inherited an extensive copper network upon its privatization, and is due to receive A$8.4 billion ($7.4 billion) in taxpayer funds as part of arrangements for allowing the National Broadband Network to use this infrastructure.

This influx of funds will give Telstra an unfair advantage against its rivals, Optus chairman Paul O'Sullivan said during a speech covered by the Australian.

O'Sullivan said the sum paid to Telstra is likely to increase under the Coalition government's revised multi-technology model for the NBN rollout.

He urged that if Telstra is to play a key role in the NBN, regulators should consider splitting Telstra's copper network from the rest of the business, in a model similar to the one employed by UK operator BT.

He said Telstra currently captures around 70% of the profits generated by Australia's telecom industry, and as a result competition in the sector is under more threat than any time after it was introduced in 1992.

Telstra was privatized in three stages between 1997 and 2006. Forcing the operator to structurally separate has been a recurring suggestion for tackling its market dominance.

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