Australia - Telecoms Industry - Wholesale Market - 2009-2010

Synopsis

Wholesale continues to be a problem area for the industry; if anything the developments in late 2009 have been a further set back for an already struggling industry. Margins are often extremely thin and Telstra can ruin the viability of the industry with the stroke of a pen. The ACCC has been very active in investigating this field, but they obviously didn’t feel strong enough to instigate the important foreshadowed changes. A major set back for the industry was Telstra’s decision under its previous CEO to clamp down on wholesale, this led to a sharp decline of this market, which still continued in 2009. While changes to the regime will occur in 2010 it highly unlikely that this will lead to an immediate improvement of this market. Perhaps by 2011, this situation might finally reverse again. Important to watch in 2010 are the regulatory changes to the legislation in relation to the structural separation of Telstra and the wholesale business model that will be developed by NBN Co.