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Wednesday, August 17, 2005

Telstra to be split

TELSTRA will be split in two in an effort to boost competition in the $30 billion telecommunications industry as part of a package of reforms ahead of its full privatisation.

The package, believed to have been approved by cabinet last night, will force a furious Telstra to create distinct network and retail divisions, with separate premises and management but under the same company structure.

If the measures are passed by the Coalition partyroom as early as today, legislation to sell Telstra could go before parliament next month.

That would allow the Government to sell its 51.8per cent stake in Telstra before the end of next year.

The concept of splitting Telstra into separate divisions - so-called operational separation - has been promoted as a means of reducing Telstra's dominance since deregulation of the telecoms market started in the mid-1990s.

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