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Friday, 24 June 2011

Deregulation and the establishment of Telstra

Deregulation and the establishment of Telstra

In Australia the 1982 Davidson Enquiry regarding private sector involvement in delivery of existing/proposed telecommunications services recommended ending Telecom Australia's monopoly. In the preceding year Aussat Pty Ltd, another government agency, had been established to operate domestic satellite telecommunication and broadcasting services.
In practice Aussat's charter restricted it from acting as a competitor to Telecom, including a prohibition on interconnecting public switched traffic with Telecom's network. Aussat's viability was undermined through restrictions on raising capital, of critical importance given tepid government support and increasing costs. It wasn't until 1985 that Australia's first geostationary communications satellite was operational; by late 1990 it had debts of about $400 million.
The Australian Telecommunications Commission was restructured as the Australian Telecommunications Corporation, trading as Telecom Australia, in 1989. That year saw the last domestic telegram handled by Telecom, with responsibility for telegram operations handed over to Australia Post.
Proposals for a merger of Aussat and OTC (thereby permitting national delivery of telecommunication services in competition with Telecom) were rejected in favor of disposal of the satellite operator to a non-government entity that would be allowed to compete with Telecom.
Immediately following the decision that Optus Communications - a private sector entity owned by a consortium that included BellSouth - would be given Australia's second general carrier licence purchased the Satellite assets with many of the Non Satellite Assets remaining with the Government as part of Telstra.
Cable & Wireless, privatised after several decades of UK government ownership, took a controlling stake in Optus in 1998 (under the banner Cable & Wireless Optus) before control passed to SingTel in 2001.

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