This IDC Flash analyses the ongoing campaign by institutional hedge fund managers Elliott International for the structural separation of New Zealand telecommunications incumbent, Telecom. As a 3% Telecom shareholder, Elliott has nominated two local, independent candidates — Mark Tume and Mark Cross — to the board of directors in order to provide "new thinking and new ideas" regarding Telecom's long-term strategic direction with specific reference to structural separation. Elliott says the separation and sale of Telecom's wholesale and access divisions from its retail operations will simplify operations and unlock shareholder value. In March 2008, the operational separation of Telecom into three parts — networks and access, wholesale, and retail — was completed based on the model pioneered by BT in the United Kingdom. The response of Telecom to Elliott's proposal is it does not believe that separating the retail and network businesses will be in the best interests of the shareholders at this time.