00:00Australia's Communications Minister will meet today with the country's three major mobile network companies
00:06following a series of outages, including failures of the emergency triple zero call system.
00:12That system is run by Optus, a subsidiary of Singapore's Singtel.
00:16A 13-hour triple zero outage last month blocked hundreds of emergency calls and has been linked to three deaths.
00:23Bloomberg Intelligence says Optus risks losing market share to rivals as public distrust in the health of its network grows.
00:32Joining us now from Melbourne is Helen Byrd, Senior Law Lecturer at Swinburne University.
00:38Really good to have you with us. It is an unfortunate turn of events.
00:44I think your sense is it might have been one that could have been prevented.
00:49Talk us through how things got so bad.
00:52Well, I guess we have to go back a little bit in time because the first major outage that occurred that we're discussing, it was back in 2023.
01:01And at the time, Optus was called to account for that and the CEO of Optus stood down.
01:07Two years on, in 2025, there was another outage and this time it was linked to three deaths.
01:12I think it's important to say that Telstra, sorry, beg your pardon, Optus is not the only carrier that has failed its triple zero service.
01:21The other large carrier is Telstra and it's had problems as well.
01:25So we have to accept that outages occur.
01:27The complaint here is with the way in which it was managed and the response that was taken in dealing with that outage,
01:34which has simply took too long and has caused a lot of problems, both reputational and regulatory for Optus.
01:41Yeah, there are a lot of questions as well about accountability, even after those previous episodes.
01:48Helen, what is your sense of the safeguards that should be put in place and can they be put in place?
01:54Well, I like to sort of say regulation of this field, which is telecommunications, has what we call carrots and sticks.
02:00When I talk about sticks, I mean things that the government can impose that have the dire consequences that if you don't follow them, you're going to be punished.
02:08So in a sense, they seek to deter misconduct.
02:11And how you might do that is you can impose penalties for failing to provide a safe system of triple zero outage.
02:17You can also set up an industry ombudsman.
02:19And both of those are things that the government is doing at the moment.
02:23But honestly, they're not short term considerations.
02:26The government has to actually find someone to be the ombudsman and set up the infrastructure to do it.
02:30And they've also yet to determine what are the obligations that they'll require the telcos to follow that are imposed by the ombudsman.
02:37And finally, what penalties will be imposed?
02:39So we're talking six to 12 months.
02:41But they're all sticks that work in deterring people from misconduct.
02:45The alternative method is to look at the carrots.
02:48That is, what are the incentives that drive this company to succeed?
02:52And really what we're saying is that help it to make its profit.
02:55And the short answer to that is that they're licensed to be a carrier.
03:00So the government already has that.
03:02They've given a license to Optus and to Telstra and to TPG, who are the Australian major carriers.
03:07And what we're saying is it's possible to now put some conditions on how they operate on that license.
03:12And we could have immediate effect.
03:15And that, again, incentivizes them to make the changes we need them to make right now.
03:19So what I'm suggesting to you is longer term, further regulation, further imposition of obligations is quite understandable.
03:27But short term, we could actually achieve quite a lot immediately without having to go through this whole regulatory process.
03:34When it comes to trying to avoid the pitfalls that we've already seen, given that you really need to recognize the issues first,
03:44how difficult is it to look at corporate culture, corporate governance, especially in private companies, in order to be able to set up these regulatory guardrails?
03:54Well, I guess one of the biggest problems with Optus is it's supplying critical infrastructure, but it is a private company.
04:00And so we have no, as we call it, disclosure, no transparency about the way the companies run.
04:06Now, I believe that in about May 2024, Singtel announced that it would devolve most of the responsibility for running Optus to a board in Australia.
04:14And that board was set up with what we call independent directors to make it more accountable.
04:19But unfortunately, there's no detail under that.
04:21So when you go to the website, when you go to look at Optus documents, you can't work out how it manages the corporation,
04:26what's its organisational structure, how it manages its risks.
04:31And when we're talking about governance and culture, we need to see that steps are in place to make sure these things are taken seriously.
04:39None of that is publicly available.
04:41Now, the comparison you need to make is not actually with another telco.
04:44It's with banking, because banking also needs a licence and is treated as an essential service in Australia.
04:50And there are all sorts of steps of accountability that are required of any bank to a regulator.
04:55In that case, it's the Australian Prudential Regulation Authority.
04:58So what I'm suggesting is that the same kinds of steps need to be placed on Optus.
05:03Some of this for Telstra is achieved by it being a public company and it being accountable as a public company, which Optus doesn't.
05:10So if we're not going to have a requirement that it act as a public company or equivalent type of obligations,
05:18then what we need to do is have a system in place that says, OK, you need to be accountable to the regulator here,
05:24which is the Australian Communications and Media Authority, in the same way or similar way to banks are accountable to the banking regulator.
05:32You mentioned that in order to put that system in place, the measures would be long term.
05:38But given that we do have a looming bushfire season also, what are some of the vulnerabilities that need to be dealt first with Australia's infrastructure at the moment?
05:49Well, the Australian Communications Media Authority set up a system called the emergency call rules that operated from November.
05:56And in those rules, the things they have to do are, for example, make sure that there is what we call camping on.
06:02So if the triple zero service fails on your network, the network must be immediately shifted to your competitor so that they can get access to triple zero.
06:11So that has to work.
06:12Now, the evidence is that they did do that at Optus, but a good number of people, I'd say about in the order of 30 percent, could not get through to triple zero.
06:21So there's question marks over why that system didn't work.
06:24And I think in the last outage that Telstra had, they had problems with that as well.
06:28But in addition to that, there's very important communication obligations.
06:32You have to let the government know immediately.
06:34You have to tell the emergency services themselves who it is that's been trying to call.
06:39We talk about welfare checks where we check on patients who were trying to get through.
06:43But it's more important to let the emergency services know who it is exactly that missed being able to call you.
06:49So it's those real time results that have been already set by the government through its emergency call rules procedures.
06:56We need to make sure that Telstra is attending, sorry, beg your pardon, Optus is attending to those requirements.
07:01And at the moment, we don't know.
07:03Now, in fairness to Optus, they are conducting an inquiry to find out what happened and why those things failed.
07:10But the truth of the matter is that that's their own inquiry, which they're funding.
07:15So the government itself needs independently to be sure that these steps have been taken.
07:19And that's why ACMA, the regulator, needs to come in and really take a hard look at these issues.
07:24Helen, thank you for helping us to unpack, I think, what some of these recommendations and fixes that are required should look like.
07:36Helen, really great to chat.
07:38Helen Byrd is Senior Lecturer of Law at Swinburne University.
07:42Now, we have more on Australia ahead every Tuesday at 11.40am if you're watching in Sydney, 8.40am in Hong Kong.
07:50Plus, you can tune into the Bloomberg Australia podcast, which delves into the bigger story shaping the country's role in global business.
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