Australia to Pass Telstra Split Laws, Making Way for High-Speed Internet

Australian lawmakers are set to pass laws splitting Telstra Corp.’s businesses, necessary for Prime Minister Julia Gillard to realize her A$35.7 billion ($35 billion) high-speed Internet plan.

Gillard yesterday released part of NBN Co.’s corporate plan, boosted consumer protection and established a committee to oversee its rollout to woo independent Senators Steve Fielding and Nick Xenophon. The government already has the support from the Australian Greens, clearing the way for the Telstra laws to pass in the Senate. Telstra shares rose as much as 6.1 percent today in Sydney trading and closed up 3.6 percent at A$2.88.

Gillard’s government needs to gain the support of four non- party lawmakers in the House of Representatives and seven extra votes to pass laws in the Senate. A vote on Telstra is expected in the Senate by tomorrow, before Parliament has a two-month Christmas break.

“This an important piece of legislation and it ends the year on a high note for the government,” Nick Economou, a political scientist at Melbourne-based Monash University, said in a phone interview. “This makes way for substantive national policy that will be popular with voters in country electorates.”

Fiber Optics

The national Internet plan is the nation’s largest infrastructure project and includes an A$9 billion deal with Melbourne-based Telstra, the nation’s biggest phone company. It will be completed by 2018, laying fiber optics that would reach 93 percent of the population, with the remainder served by wireless and satellite coverage.

Gillard earlier this week intervened in negotiations to win the support of independent lawmakers for the laws.

“I’m very pleased that what’s happened in the parliament this week is a win for families who are going to get faster, cheaper broadband,” Gillard told Australian Broadcasting Corp. radio today, “That’s what has come out of the parliament this week and Australians want broadband.”

Communications Minister Stephen Conroy introduced the national broadband plan laws to the lower house today. Both houses of parliament are to debate that legislation next year.

“This will help Gillard dispel a notion the government has no agenda,” Economou said. “It will also help them shake this perception that the government and the parliament are marching to the beat of the Greens.”

To contact the reporter on this story: Gemma Daley in Canberra at gdaley@bloomberg.net

To contact the editor responsible for this story: Bill Austin at billaustin@bloomberg.net

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