Newsletter - June 2005

Regulatory reform... what's in it for you

For users of IT&T, regulatory reform could mean lower costs, access to more new and innovative services, and greater choice in suppliers and service levels.

Why? Because at the core of the debate is establishing a level playing field for competition in the Australian market.

A key way to do this is to separate Telstra wholesale from Telstra retail.

This means that all service providers – including Telstra retail – will purchase services from Telstra wholesale at an equal rate.

In turn, by freeing the wholesale arm, the market will be opened for a whole new range of carriers that can compete against Telstra retail.

By increasing competition, telecommunications markets will further deliver price reduction and innovation to customers.

History proves that industry and public pressure on government and regulators is a way to ensure better competitive outcomes.

Macquarie Telecom has been a champion of reform since the company was founded in the early 1990s.

It has played a key role in lowering the cost of local calls by more than 27 per cent and achieving a 45 per cent reduction in the wholesale cost of fixed-to-mobile call rates.

These are savings that we can pass on to you – the customer.

But the biggest challenge is ahead of us.

The impending sale of Telstra – T3 – is a catalyst for regulatory and industry change.

It represents an opportunity to get the reform process right: to implement a level playing field for all participants and remove some of the roadblocks that have stifled competition to date.

At ATUG's recent annual conference for 2005, David Tudehope, Macquarie Telecom CEO, outlined the company's vision for regulatory reform.

This includes:

• Establishing ‘ring-fencing' or ‘arms-length dealing' rules between Telstra Wholesale and Telstra Retail
• A de-merger or divestiture power to complement existing ACCC powers on mergers and acquisitions
• Increase ACCC resources, expertise and funding
• TPA reforms
• The ‘right' people in ACMA (the ABA/ACA merger)
• Changes to the USO ‘modus operandi'

Without effective regulatory reform, Australia's viability as a competitive nation is in danger.

Macquarie Telecom continues to play a leading role in the Competitive Carriers' Coalition in Australia, and the Asia Pacific Carrier's Coalition to actively stimulate the reform process.