| The telecommunications sector in Australia is | | | | viability as a telecommunications player was greatly |
| predominantly saturated by telecoms provider, Telstra. | | | | undermined by difficulties in raising capital, tepid |
| But despite this, space is also a playing ground for | | | | government support and spiraling operation costs. |
| other telephone carriers which include Optus, AAPT | | | | It wasn't until 1985 that Australia's first geostationary |
| and Powertel, Soul, Vodafone and Hutchison 3G. | | | | communications satellite was operational; by late 1990, |
| According to BBG Communications, the main | | | | however, it was saddled with debts amounting to |
| telephony network in Australia is connected through | | | | about $400 million. |
| optical fibre networks, with households tapped to the | | | | The Australian Telecommunications Commission was |
| network through copper lines that are linked in local | | | | restructured, giving way to the Australian |
| exchanges. For mobile telephony, Australia runs on the | | | | Telecommunications Corporation. The new entity |
| GSM platform, like those in Europe and majority of its | | | | traded as Telecom Australia, in 1989. It was also the |
| neighboring countries in the Asia-Pacific. In 2003, 3G | | | | same year which saw the last domestic telegram |
| mobile phone services were introduced, adding another | | | | handled by Telecom, as responsibility for telegram |
| plus to the generally considered good domestic and | | | | operations was handed over to Australia Post. |
| international telecommunications services in the | | | | There were proposals floating for a merger of Aussat |
| country. | | | | and OTC, but all were rejected in favor of the disposal |
| Primarily the Optus satellites C1 D1 and D2, are the | | | | of the satellite operator to a non-government entity |
| domestic satellite systems in use for very remote | | | | that would be allowed to compete with Telecom. |
| areas. | | | | Immediately after, Optus Communications - a private |
| Telstra, Optus, Nextgen Networks, PowerTel and | | | | sector entity owned by a consortium that included |
| AAPT are the main Intercity Networks with a | | | | BellSouth - was given Australia's second general |
| collection of other providers having regional networks | | | | carrier licence. Optus proceeded to purchase the |
| or Eastern Coast links. | | | | Satellite assets with many of the Non Satellite Assets |
| Telstra is the main user of microwave links in remote | | | | remaining with the Government as part of Telstra. |
| areas; WIN Television provides a network of | | | | Cable & Wireless, privatized after several |
| microwave towers for distributions of Television, and | | | | decades of UK government ownership, took a |
| provides common carrier services. Other providers | | | | controlling stake in Optus in 1998 before control passed |
| such as Agile Communications provide backhaul | | | | to SingTel in 2001. |
| services in South Australia. | | | | Optus was initially allowed to cater the national long |
| Section 51(v) of the Australian Constitution gave the | | | | distance and international telephone calls service in the |
| new national government power over all postal, | | | | Australian telecommunications market. The restrictions |
| telegraphic, telephonic and 'other like services'. The last | | | | on players that can enter the general telephone |
| clause embraced future developments in the | | | | market until 1997 and 'pro-competition' mechanisms |
| telecommunications front, which from then meant radio, | | | | under the Trade Practices Act 1974, among which |
| television and the internet. | | | | guaranteed access to Telecom's existing infrastructure |
| The colonial telecommunications network infrastructure | | | | on reasonable terms, meant to ensure Optus’ |
| (staff, switches, wires, handsets, buildings etc) were | | | | viability. |
| handed over to the Commonwealth and became the | | | | Competition in long distance corporate voice and data |
| responsibility of the first Postmaster-General (PMG). | | | | service operations was so steep. It was also felt by |
| The PMG position is a Federal Ministerial post, | | | | Telstra versus AAPT which was active from 1991, |
| overseeing the Postmaster-General's Department that | | | | MCI Communications, later absorbed by the ill-fated |
| was in charge of all domestic telephone, telegraph and | | | | WorldCom, was an early major shareholder of AAPT |
| postal services. With 16,000 staff, it accounted for 90% | | | | but got out in 1994. New Zealand's Todd Corporation |
| of the new federal bureaucracy. That figure went up | | | | took a 24.5% stake in AAPT in 1992. In 1995 AAPT |
| to over 120,000 staff (around 50% of the federal | | | | launched a mobile phone service, using Vodafone as |
| bureaucracy) by the late sixties. | | | | its network supplier, acquired a 50% share of the |
| Public phones were then available only in few post | | | | Australian ISP au Pty Ltd and bought NewsNet ITN. In |
| offices. Other limited phones installations were made | | | | the same year SingTel acquired a 24.5% shareholding |
| available to major businesses, government agencies, | | | | in AAPT. |
| institutions and among propertied residences. There | | | | AAPT went on to muscle up. In 1996, it bought 40% of |
| were around 33,000 phones across Australia, with | | | | Cellular One Communications, followed by QNET |
| 7,502 telephone subscribers in inner Sydney and 4,800 | | | | Communications. In the same year it gained a carrier |
| in the Melbourne central business district. A trunk line | | | | licence, offering long distance services to the residential |
| ran between Melbourne and Sydney starting 1907, with | | | | market and building communications networks for the |
| extension to Adelaide established in 1914, Brisbane in | | | | South Australian and Victorian governments. |
| 1923, Perth in 1930 and Hobart in 1935. | | | | Subsequently, it moved to 100% of CorpTEL |
| Meanwhile, overseas cable links to Australia remained | | | | Communications, its AAPT Sat-Tel satellite joint |
| to be privately owned and managed by then, reflecting | | | | venture, au and Cellular One. US-operator Primus |
| the dynamics of imperial politics, demands on the new | | | | acquired Axicorp in 1997, gaining a carriers license and |
| government's resources and the allocation of | | | | expanding into internet services. |
| responsibilities at that time. The PMG department | | | | AOTC had a brand makeover as Telstra Corporation |
| became responsible for some international shortwave | | | | in 1993, trading internationally as Telstra starting the |
| services - particularly from the 1920s - and for a new | | | | same year and domestically from 1995. Its attempts |
| Coastal Radio Service in 1911, with the first of a | | | | for expansion to Indonesia and other Asian markets |
| network of stations operational in February 1912. | | | | did not live up to the company’s expectations, with |
| Australia and New Zealand had ratified the 1906 Berlin | | | | the group winding back overseas involvements in |
| Radio-telegraph Convention in 1907. | | | | 1997-98. In 1996 Telstra recorded the largest profit in |
| During the 1930s the PMG became responsible for the | | | | Australian corporate history, some $3.8 billion and was |
| Australian Broadcasting Commission (ABC). PMG’s | | | | partly privatised in November 1997 through sale by the |
| management of the telecommunications network ABC | | | | Commonwealth of around 33.3% of its shareholding. |
| echoed BBC’s own story. | | | | After Australia's telecommunications market was fully |
| As privatization has been changing the landscape of all | | | | opened up to full competition in July 1997, privatization |
| service and utility providers, many tend to romanticize | | | | followed. A further 16.6% was sold by the |
| and era when enterprises were supposedly ran not | | | | Commonwealth in September 1999 bringing the shares |
| for profit but for service. It has become fashionable | | | | sold to a total of 49.9%. This figure is safely below |
| for some quarters to praise those times when PMG | | | | 50.1%, at which rate, any sale of government-owned |
| was supposedly an enlightened technocratic | | | | properties involves legislation. With the new regime |
| management, moved only for the national interest, and | | | | came the adoption of a single national phone |
| public service, over and above profit. | | | | numbering scheme and any-to-any connectivity |
| The image of a benevolent PMG is not without | | | | requirements. Mobile phones, fixed-line phones and |
| problems, as it is apparent that decisions on location | | | | other devices was designed to communicate with |
| and management of facilities were reflections of local | | | | each other irrespective of whether the service was |
| political demands and the 'Australian Settlement' first | | | | provided by Telstra or one of its competitors. In |
| articulated by Alfred Deakin. The PMG was, after all, | | | | November 2006, an additional 33% was sold by the |
| a major employer in rural areas, the Minister generally | | | | government. The remaining 17% was placed in a |
| came from the Country Party and there was an | | | | Future Fund to provide full separation from |
| emphasis on in-house development and local | | | | government and regulations. This followed to avoid |
| manufacturing. | | | | many possible conflicts of interest with the |
| The observation then was that governments of | | | | government being primary shareholder and competition |
| whatever party affiliation benefited from the | | | | regulator. |
| organisation’s revenue generating nature. Many | | | | By July of 1997 the Australian telecommunications |
| would say that PMG was not a discrete statutory | | | | sector was fully liberalized for full competition with |
| body, with no power on its own to retain its revenues, | | | | removal of restrictions on the number of licensed |
| and was captive to national political dynamics. | | | | operators and anti-competition mechanisms. |
| In 1982, a Davidson Enquiry on Australia’s | | | | By the end of 1998, there were over 20 licensed |
| telecommunications services sector, made a | | | | telecommunications carriers in Australia, with several |
| recommendation to end Telecom Australia's monopoly. | | | | hundred other entities using those carriers’ facilities |
| In the following year, Aussat Pty Ltd, another | | | | to provide services. By May 2002, this figure climbed |
| government agency, had been established to operate | | | | to 99 licensed telecommunications carriers. The |
| domestic satellite telecommunication and broadcasting | | | | Australian Communications Authority estimated that |
| services. But Aussat's charter did not allow it to be | | | | the benefits to consumers of telecommunications |
| a direct competitor to Telecom. A case in point is its | | | | services from competition in 2000/1 were between |
| charter’s prohibition on interconnecting public | | | | $5.5 billion and $12 billion. |
| switched traffic with Telecom's network. Aussat's | | | | |