Fulfilling another promise of its ambitious national broadband program, Australia's Senate has passed a bill that will split the country's biggest telco into separate retail and wholesale operations. Telstra will also sunset a big chunk of its copper wire operation, making way for Australia's massive nation-wide fiber project.

"Ever since Telstra was privatized Australians have suffered," Communications Minister Stephen Conroy declared shortly after the vote. "They have suffered with high prices, less competition and less innovative services. Today is about celebrating a significant win for Australian consumers."

The government let go of Telstra in the late 1990s. But, over the coming eight years, Australia's taxpayers will fork over AUS$43 billion (US$38 billion) to build a "world-class broadband infrastructure." The project will deliver fiber-to-the-home to 93 percent of all households. We're talking open access and wholesale only. Every ISP will be able to tap into the system.

As for Telstra—or as a government report put it, Australia's "highly profitable vertically integrated and horizontally integrated incumbent with a monopoly position in most fixed-line access in many backhaul routes"—the bill is intended to keep the company from favoring its own retail offerings over those of other ISPs that buy access to its network.

Got to transform

Telstra more or less signed onto this plan about five months ago, pledging (for AU$9 billion) to siphon its customers away from copper and cable and onto the new system. In addition, it will open its own networks to the government for use.

"This company has got to transform,'' Telstra CEO David Thodey told the Sydney Morning Herald earlier this year. ''It has got to move from being an engineering and a technology-led company to being a truly sales and marketing-led company.''

The Senate vote didn't come without a bit of tension between the government and its opposition, which has been calling for a cost-benefit analysis of the project. ABC Australia's PM news site posted this rather testy exchange between Conroy and a reporter following the vote.

"If anybody thinks that any program in the world can be rolled out with zero mistakes, which appears to be the test some people want to put on, if there's going to be an intention to find every single person whose letter and mail goes missing for Australia Post, probably you'd successfully campaign to close Australia Post down," Conroy declared.

"What success rate would you be happy with then?" the reporter asked.

STEPHEN CONROY: Well do you think 100 per cent is possible? REPORTER: Well, well, I'm asking you STEPHEN CONROY: Do you think 100 per cent is possible? REPORTER: I'm not answering the questions, I'm asking them STEPHEN CONROY: No, I'm just looking for a guide for you. You seem to . ah, be arguing that 100 per cent is a reasonable test. I just wanted to double check that you didn't think 100 per cent was a reasonable test. REPORTER: I'm asking what you'd be happy with. STEPHEN CONROY: We want to ensure that every Australian gets a positive experience.

That is, after all, the idea. The law must be ratified by Australia's lower House of Representatives, but most observers think it's a done deal.