[LINK] Fwd: Breaking Up Telstra (and Optus etc.)
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Thu Oct 22 21:37:08 AEDT 2015
Forwarded with permission.
-------- Forwarded Message --------
Subject: Breaking Up Telstra (and Optus etc.)
Date: Thu, 22 Oct 2015 10:57:25 +1100
From: Malcolm Moore <mmoore at bigpond.net.au>
Breaking Up Telstra
Having worked in the PMG / Telecom Australia / Telstra for over 30 years
and being in the telecomms industry for over 45 years in a very wide
number of Technical, Engineering and Commercial roles; I have a very
detailed historical knowledge of the entire telecomms business and the
Before the introduction and wide adaption of silicon-based technologies,
the PMG / Telecom Australia was primarily an analogue-based
infrastructure business with very high technical and engineering
overheads and a very small range of retail products.(The Plain Old
Telephone Service (*POTS*) comes to mind.
After the very wide adaption of silicon-based technologies, Telecom
Australia / Telstra (and all the associated "competing telecomms
businesses") now have extremely low technical and engineering overheads
and a large range of commercial retail products and services.
Put simply, it was *not privatisation* that made these telecomms
business "efficient" it was purely the sequential *advances in
silicon-based technologies* and the *development of software-based
technologies* that made the telecommunications infrastructure very
inexpensive to manufacture extremely inexpensive to maintain, and
concurrently produced a wide range of new commercial
telecommunications-based *retail products and services*.
The *competitive Retail Reselling* of what is now very inexpensive
telecommunications infrastructure-based communications products and
services makes the telecommunications businesses (Telstra / Optus etc.)
look to be very highly efficient for all the wrong reasons.
With this diametrical change in business focus, the control of
successive telecomms infrastructure rollouts shifted from the Engineers
who knew and understood the overall telecomms infrastructure to the
(Retail) Sales and Marketing executives who have a very limited
knowledge of the infrastructure.Concurrently, the focus of
infrastructure builds has moved to much shorter (sales-based) timeframes
and localised to where the short-term ROI is maximised (for "maximised
The Davidson Report (1982) created a telecommunications sector on the
ASX to significantly broaden the investment base outside then mining,
banking and insurance sectors, then proceeded to break up what was an
extremely efficient telecommunications infrastructure commission into
one of the worst possible economic scenarios: Privatised Competing
From about 1995 the Telecommunications Industry Ombudsman (TIO) started
to be flooded with intractable service / billing complaints and since
then there have been over 15 Select Senate Inquiries and Regional
Inquiries (virtually one every second year) to report on, but not
identify the causes of, the sharply declining state of
telecommunications infrastructure in Australia.
Since then successive Federal Governments introduced several very
ill-considered short-term (private sector favouring) "initiatives" and
all of these were naturally failures because none of these "initiatives"
were "infrastructure business" focused.
Essentially, the privatisation and splitting up of the highly efficient
one "economy of scale" telecommunications infrastructure business has
created an economic nightmare of monstrous proportions for successive
Australian Governments, and this telecommunications infrastructure
wreckage that is now seriously crippling non-metropolitan Australian
business and life standards.
The current NBN (version 5) is an open admission that breaking up the
Australian telecomms infrastructure was fundamentally flawed, and
throwing in of over $50 Bn into the NBN from the Federal Government(s)
is proving to be highly uneconomic because the NBN was essentially a
rather flawed academic strategy instead of a well-considered engineering
Infrastructure is virtually everything that is not Retail Reselling (all
the exchange sites, switches, transmission equipment, racks frames, A/C,
power, batteries, control support networks, cable conduits, pits,
sputniks, radio base stations, towers, radio systems, satellite, earth
base stations, Network Construction and Design, tractors, O/F trenching
machinery etc etc – all of this (and more) is infrastructure- none of
this is Retail Reselling (shops, exec offices, etc). This split is
The merging of the ex-Telstra , Ex-Optus and NBN telecomms
infrastructures into one "economy of scale" infrastructure business"
(with an Infrastructure Business mindset) will quickly provide a massive
internal saving because the overheads of inter-business leasing will
immediately stop, floor-space in all exchange sites will become readily
available and Engineers can plan and lead the building of the
telecommunications network without short-term interference.
This "infrastructure business" mindset will in turn provide less
expensive Wholesale prices, which will in return provide increased
profits to the Retail Resellers.So the sale price of handing over the
Telecomms infrastructure is ZERO.
The split is extremely simple: Retail Reselling / Marketing - - - -
That’s it. Can be done in about 10 working days from top to bottom.
Malcolm Moore JP BE(Elect.)
mmoore at bigpond.net.au <mailto:mmoore at bigpond.net.au>
02 9440 0541
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