John Linton I read the articles in the various business sections of the more reputable newspapers and business journals yesterday outlining Telstra's "secret" moves to use the money previously budgeted for their FTN roll out to upgrade their current fibre network used for Foxtel. Nothing really sinister in that in isolation but it's either being used as a lever for their ongoing 'war' with the Federal Government or something a little more worrying.
Telstra's decision not to wholesale their ADSL2 services was difficult to understand in any way other than it marked a change in how it saw regulation - it justified the decision by saying there was already sufficient competition in the exchanges because one or more other companies had installed ADSL2 DSLAMs in them and Telstra would only install DSLAMs in exchanges where another company had already done so.
The clear conclusion was that Telstra was saying it was just one communications company retailing its own services in competition to "similar" companies that had already done the same thing! This is a new premise that "poor Telstra" was just one player in a competitive market doing the best for its shareholders with no other obligation than that to its shareholders.
It will now be able to do the same with FoxTel/the upgraded fibre network only more so as, at least at the moment, Foxtel is only jointly owned by Telstra who can reasonably claim that Optus and Austar are already viable cable providers and it has only commercial obligations to compete in the fibre marketplace.
Fair enough - at least a case can be made.
It's also understandable that Telstra will become a purely 'commercial company' one day in some unspecified future time.
My concern, as a planner for a company that has built its current business by buying services on a wholesale basis from Telstra, and to a lesser extent from Optus, is that Telstra is giving out clear signals that it's war is with its large wholesale customers (Optus and AAPT) and its smaller wholesale customers (and I only care about Exetel) will be harmed in that process.
While we saw the dangers of being totally dependent on Telstra Wholesale from the very start of Exetel and took a lot of trouble (not to mention pain, grief and loss of money) to diversify our suppliers by buying base services from Optus, Powertel, Unwired and Vodafone it seems that there is not as much time to complete that diversification as we originally thought.
So, just as Exetel has reached the more comfortable financial and operational stage of development being well in to its fourth year of operation, a much scarier scenario has arisen.
I suppose the only saving grace is that we didn't mortgage our personal and business assets to "invest in our own infrastructure". That was a very brave call by those companies that made it and one that looks like either making or breaking them over the next three years.
At least we still have all choices, whatever they might turn out to be, available to us.