Which I think is where we fail to communicate. Telstra is not the problem. At least, not all of it.
Telstra, the retailer, is subject to competition. That mitigates its profiteering ways, to some extent.
Telstra, the owner of essential natural-monopoly infrastructure, has no effective competition. Indeed, by definition:
“A natural monopoly occurs when the most efficient number of firms in the industry is one.”
competition would be a poor allocation of resources.
The task then is to separate out what should be publicly-owned. That has been considered in a blog post referenced elsewhere in this forum:
Remedy past mistakes
Return infrastructure to public ownership.
Separate Telstra into retail and wholesale/infrastructure arms. The best mechanism I’ve been able to come up with takes the form of a de-merger. Telstra is split into two companies, with shareholders given shares in each proportional to their current Telstra shareholding. Government then acquires all shares in the wholesale/infrastructure company, at value.
Return radio frequency spectrum to public control. The easiest way would probably be to not renew spectrum licences as they expire. Associated assets of providers other than Telstra could be acquired at value, where economically and operationally rational.
Establish a statutory Commission to provide telecommunications infrastructure and wholesale services. Vest in the Commission all infrastructure and wholesale assets formerly held by Telstra and nbn™.
Not easy, not cheap. It’s generally cheaper & easier to make a mess than to clean it up.
Which is where we go wrong. Allowing the private sector to cherry-pick lucrative markets, while leaving the rest to the taxpayer. To me, it makes far more sense to cross-subsidise from profitable market to the less-profitable. The most effective way to ensure that is to have the entire network under public ownership.
The NBN is being fattened up for privatisation. Quite apart from the current government’s deliberate sabotage, that’s like shooting a horse in the head, then wondering why it didn’t win the race. A better example is the PMG. Most of us were quite satisfied with its performance. The wheels started to fall off after telecommunications functions were separated from postal. Even then, it worked reasonably well until the Telecommunications Commission was restructured into a corporation.
