Australia's competition watchdog on Wednesday welcomed government plans to split up telecoms giant Telstra as shares in the company bounced back from a slump following the shock announcement. Australian Competition and Consumer Commission (ACCC) chief Graeme Samuel said consumers were 'clear winners' from the push to divide Telstra's retail and network arms. 'At long last we're seeing competition quite clearly infused into the telecommunication sector,' Samuel told public broadcaster ABC. Communications Minister Stephen Conroy announced Tuesday that Telstra, which reaps about 90 percent of the profits from Australia's telecoms sector, would be barred from acquiring new wireless spectrum unless it voluntarily splits. He said the government wanted to break Telstra's market stranglehold before spending 37 billion US dollars on a national broadband network. Samuel, a frequent critic of the former state-owned monopoly's market dominance, said the move was long overdue. 'What we're now seeing ... is the correction of mistakes of previous governments going back as far as the early 1990s,' he said. The announcement initially sparked jitters among investors but Telstra shares rose 4.18 percent to 3.24 dollars (2.79 US) Wednesday, clawing back virtually all the previous day's losses. 'In our view (the) announcement could mark the last of the adverse regulatory news flow for Telstra,' Goldman Sachs JBWere analyst Christian Guerra said in a client note. 'While full resolution is unlikely until the end of the year, we are nearing greater certainty.' Under the reforms, Telstra will not have access to the wireless spectrum it needs for next-generation mobile phone services unless it restructures and sells off its cable infrastructure network and stake in Foxtel pay TV. But it may be allowed to keep the assets if it comes up with an alternative structural change acceptable to the government and competition regulators. 