Telstra separation debate heats up on CRN

Simon Hackett, managing director at Internode, has raised the ire of a few CRN readers, after voicing his opinions on the benefits for the channel if Telstra's wholesale and retail divisions are separated.

Some readers felt Hackett voiced his opinion for the separation of Telstra because of personal gain.

One reader said: "No surprise here, of course Simon Hackett wants Telstra destroyed, they are his main competitor!"

"He is only thinking of his own profits if Telstra was destroyed!

"His plan to do a full node cutover and take all Telstra's customers failed when the government knocked back all the NBN bidders, so now he is trying a different way to destroy Telstra!

"Who is going to pay Telstra shareholders compensation? Is Simon going to?"

Another reader felt: "Structural separation was needed back when the original privatisation was done, however the Government was doing it for commercial reasons (to raise cash)."

"The value in Telstra is that it is a monopoly - it would have been worth a fraction of the proceeds if they had separated.

"The interesting part will be - how will they split the two? What effect will it have on the share price?

 "How will they compensate the ma's and pa's who would lose millions? For this reason, I think it is unlikely."

Other readers backed up Hackett.

A reader said: "If you guys have been following Simon's writings over the years and the ISP industry in general you would realise Simon isn't approaching this from a one-eyed perspective.

"I'm no Labor supporter at all, and I'm very sceptical about the short-medium term commercial viability of FTTH servicing 90 percent of premises, but at last the Government is listening to industry experts about what is best for the industry.

"And regarding the ma and pa investors in Telstra, the writing is on the wall for everyone to read regarding Telstra's future.

"If they choose not to read it and realise the possible consequences on the Telstra share price if structural separation was to occur, so be it."

Another reader said: "There has to be a reality check.

"I support the idea of splitting Telstra but it should have been done when the privatisation came into being.

"If it can still be done, it should be done.

"Telstra's current attitude to its customers will ultimately be its downfall.

"Their staff are being tied up with complaints, their 'sales teams' are out of control deliberately fibbing to gain business from existing clients and messing in their own nests just for extra commissions."

Damian Kay, managing director at Telcoinabox and Telstra wholesale reseller told CRN, the debate around the functional separation of Telstra presents a very varied set of opinions. 

"Separation will not change the relationship a provider has with Telstra Wholesale it's the way that providers engage with it will change the relationship," he said.

"If a provider fully engages Telstra then they deserve to get (and demand) the same in return.

"Separation however may change some of the ridiculous, bureaucratic and rigid policies that prevail."

Paul Budde, principal analyst at BuddeComm said broadband also will generate a plethora of goods and services.

"It is already difficult for customers to handle all of those services on their own and this is another avenue in which the retail industry will increasingly become involved - bringing electronic goods and services together," he said.

In-depth commentary by Kay and Budde on the issue of Telstra's separation can be read in CRN 267, out to readers on 4 May.

Editor's note: Ad hominem attacks on Simon Hackett in the comments will be removed.