Media Concentration in Australia Franco Papandrea and Rodney Tiffen Introduction
Table 8: Cinemas Concentration Indices(1998-2009)
Download 401.9 Kb.
|
- Navigate this page:
- Wireline Telecommunications (1997-2009)
Table 8: Cinemas Concentration Indices(1998-2009)3.6.Telecom distribution media After some initial tentative steps Australia embarked on a two-stage program of full-scale liberalisation of its telecommunications sector. The first stage, starting in 1991, involved the licensing of a full-line private sector telecommunications carrier (Optus) to provide wireline and wireless services in competition with the publicly-owned former monopoly carrier (Telstra). The market was further expanded in 1993 with the entry of a third (wireless only) carrier (Vodafone) competing with the two full-line carriers in the mobile telephony market. In addition A third mobile operator was licensed and entered the market in 1993. The liberalisation arrangements mandated interconnection between the carriers including access of the private carriers to Telstra’s wireline customer access network (CAN) which was deemed to be an essential facility. The second stage began with the promulgation of new legislation, the Telecommunications Act 1997, which introduced a fully competitive market starting 1 July 1997. The publicly-owned carrier was transformed into a private sector corporation listed on the stock exchange and its stock was progressively sold to a wide spectrum of institutional and individual stockholders. With full competition, service provider or carrier2 licences were easily secured and progressively over 100 service providers entered the market for the supply of wireline and wireless services. Many, however, are very small in size or market share. For the analysis, the number of effective competitors (voices) in the market includes operators with revenue of more than AUD 25 million in at least one year of the review period.
With the introduction of open competition in July 1997 the number of providers of telecommunications services increased considerably. By the end of June 1997, the Australian Communications authority had issued 77 carrier licences to prospective operators in the liberalised regime. However, some of them did not become operational and others withdrew from the market soon after entry. Also, the 1990s boom in the Australian and global telecommunications industry which came to an end in March 2000 led to a shakeout causing many companies to withdraw from the sector. By June 2001, there were only 54 carriers and 88 telephone service providers listed by the Telecommunications Industry Ombudsman and not all of them were thought to be active (Productivity Commission, 2001). The weaker market outlook of the early 2000s impacted on all carriers with many scaling back their investment plans. Nonetheless competition intensified as the new entrants sought to establish themselves in the market. Telstra’s former monopolist’s status and ownership of the wireline CAN (notwithstanding a regulatory regime guaranteeing access to other carriers) has provided it with an ongoing advantage over its competitors as it sought to protect its position in the market and attenuate its loss of market share. In first few years of the liberalised regime Telstra’s market share declined rapidly from 92.0 per cent in 1997 to 78.8 per cent in 2003. The erosion slowed down somewhat afterwards but continued throughout the period covered by the analysis (see Table 9 for details). By the end of the period, however, Tesltra still remained the dominant supplier of wireline services controlling more than 70 per cent of industry revenue. This erosion of the market is particularly evident in the HHI ratio, but less so in the C4 which is based on the aggregate share of the largest four operators (see Figure 8 for details). Wireline Telecommunications (1997-2009)
Notes:a 'Number of operators' refers to active registered carriers with eligible revenue greater than AUD25 million in at least one year during review period Source: Australian Communication and Media Authority ‘Carriers Eligible Revenue Returns Data’, Australian Competition and Consumer Commission (various published reports); Companies' annual reports; Productivity Commission (2001), Telecommunications Competition Regulation Inquiry Report; and authors' estimates Download 401.9 Kb. Share with your friends:
|