Australia - broadband

'Telstra, poor broadband risks digital divide'

FAIRFAX Media chief executive David Kirk says Australia is moving too slowly on building the infrastructure needed to allow all householders to enjoy the benefits of broadband.

He has also criticised the structure of the local telecoms sector for allowing one company, Telstra, to have a "massively" favourable market position. And prices for network access will remain high unless Australia follows the path of structural separation of retail and wholesale telcom businesses.

Mr Kirk said Australia risked a "digital divide" with the rest of the world.

He pointed to data showing only 64 per cent of Australian households had access to a computer with an internet connection, behind Korea, Iceland, Luxembourg and New Zealand.

"And Australia is stuck, at 45 per cent, in terms of households with access to some form of broadband - a middle range result, trailing even the UK," he added.

Mr Kirk said Australia does not have a "robustly" competitive structure in telecommunications.

"Telstra as the legacy infrastructure owner enjoys a massively favourable position - commercially, strategically and competitively," he will tell a business audience in Perth later today, according to a copy of his speech released to the Australian Securities Exchange.

"It is extraordinarily rare in the developed world for a telco with such a position of strength in the market to be able to offer fixed line, mobile, local, long distance, international, cable television, and internet services."

He pointed to other countries, where telecoms industry regulation required a separation between wholesale and retail operations.

"Without such a structural separation, prices to consumers will likely be too high and access to the network will be limited by affordability," Mr Kirk said.

Internet broadband access was key to Fairfax's future and the country as a whole.

"The future of broadband will determine the future of our company and, increasingly, the future of Western Australia and the country as a whole," Mr Kirk will say at a Committee for the Economic Development of Australia function.

Building of digital highways was another key issue.

"This Government has promised to deliver broadband to virtually all Australian households," Mr Kirk said.

"We firmly support this objective.

"We have a good base to build on - but we are moving much too slowly.

"As a country, we are lagging, and it is hurting our competitiveness.

"Neither Australia nor Western Australia can afford to be resource rich but digitally destitute."

Fairfax today launched an online newspaper in Western Australia to capitalise on the growth in one of the country's most prosperous states.

The site, WAtoday.com.au, was officially launched in Perth by WA Premier, Alan Carpenter, Fairfax chairman Ron Walker and Mr Kirk.