The aim of this report is to review the outcomes of Australian government policy in telecommunications on the telecommunications industry in Australia. This is done by analysing the effects on prices of basic services, examining the market structure and the behaviour of firms within the industry, and comparing these against the governments objectives. It was found that where price trends were declining previous to competition they continue this trend at a lesser rate. When assuming costs are declining at the same rate now as before competition this infers prices are deviating from costs. This further suggests that the incumbent firms are exploiting the duopoly situation.
This analysis provides some insight to the likely effects of the next step in reforms due in 1997.