Wall St was down 94 overnight, its biggest fall in a month, while the local market is down 66.
Conroy orders Telstra to do the splits
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Communications Minister Stephen Conroy this morning announced that the government will force Telstra to structurally separate and overhaul the telecommunications access regime in the biggest overhaul of telecommunications regulation since the Hawke government’s reforms of the late 1980s. Telstra will in effect be made an offer it can’t refuse, invited to develop a plan for full structural separation between now and the end of November via an enforceable undertaking to the Australian Competition and Consumer Commission. If it does not do so, the government will impose a “strong functional separation framework on Telstra” and ban it from acquiring additional wireless spectrum, where it developed a strong presence under Sol Trujillo. Telstra can break itself up or be broken up. Conroy would prefer the former, but has committed to the latter if necessary. The government may also prevent Telstra from acquiring more wireless spectrum if it does not divest its hybrid fibre coaxial cable network and its interest in Foxtel. In short, Telstra has been told it will be locked out of the future of communications unless it co-operates with the new regulatory approach. Conroy also announced a significant strengthening of the ACCC’s role in managing disputes over access to Telstra infrastructure, empowering it to impose access terms and conditions of up to five years, impose “principles” for access for even longer, and make immediate binding rules of conduct to address problems during disputes. The changes tip the regulatory balance in favour of the ACCC, which has repeatedly battled Telstra in courts across the country over the past 10 years on behalf of the company’s competitors, and will reduce although not eliminate opportunities for Telstra’s preferred approach of litigating and gaming the regulatory framework to prevent economic access by its competitors to its infrastructure. As part of a set of reforms to consumer safeguards, Conroy has also beefed up the Universal Service Obligation, giving himself more power to specify standards and raising penalties to $10 million. The Australian Communications and Media Authority will also be able to prevent Telstra from removing payphones. Conroy is hoping that his legislation — to be introduced today — will be considered by a Senate committee and debated before the end of the year, giving Telstra approximately 10 weeks to develop an undertaking on full separation of its infrastructure and retail operations. Conroy indicated that Telstra had already been in talks with the government on separation, and made a point of congratulating the new Telstra leadership of Catherine Livingstone and David Thodey. Conroy said the government had deliberately left the mechanism and structure of separation open, in order to facilitate co-operation between Telstra and the government’s National Broadband Network company. The reforms in effect spell the end of an almost unique Australian experiment in an integrated telecommunications infrastructure owner/retailer set in train by Kim Beazley as Communications Minister two decades ago and continued by the Howard Government, which sold Telstra as an integrated company despite clear evidence from economists, commentators and privatisation experience around the world that it would undermine and prevent competition. The experiment has clearly failed. The access regime for Telstra’s network has never been strong enough, and as Conroy pointed out, it has been gamed and litigated remorselessly by Telstra, with more than 150 access disputes between Telstra and its competitors. It also confirms just how badly the former Telstra leadership of Don McGauchie and Sol Trujillo — ably assisted by executives such as Howard government apparatchik David Quilty and on-tap consultant Henry Ergas — overplayed their hand in trashing the company’s relationship with both sides of politics and trying to destroy Telstra’s competitors. First with the NBN and now with structural separation, the government has smashed Telstra’s monopolistic agenda with a raw display of executive power. However, the reforms open the door for the Coalition to claim the mantle of protecting Telstra shareholders — despite Conroy’s rhetoric that the reforms offer a “win-win” for Telstra — and ramp up its rhetoric about an interventionist Labor government. Expect the bill to take a lot longer than three months to work through the Senate — if it passes at all — with the Independents and the Greens using it to run all sorts of pet projects. Cannily, however, the government has loaded up the USO obligations on Telstra, something the Telstra-hating Nationals will instinctively support. This is another bold telco move from a normally cautious government, and one that — despite the inevitable criticisms from commentators — will take Australia’s poorly regulated telecommunications system a lot closer to best practice (and economic orthodoxy). It should have happened 10, if not 20, years ago. Telstra’s days as the 800-pound gorilla are at last coming to an end. |
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43 Comments
Wohoo! Now we’re talking …
Yeah nice…
I really hope Malcolm doesn’t go all ‘shareholder protectionist’ on us here though. Can someone tell them that they are the Liberal party, so they should be viewing this as fantastic for competition and the free-market, given that this is the removal of a blowback from previous government control of the enterprise. While you’re at it, tell them they should have done this themselves in the first place when they sold off Telstra and that given they were too lazy or affected to do it while they were in power, they should be applauding the Labor party for rectifying their mistake.
The so called a “win-win” strategy is actually a win lose strategy for Telstra shareholders. Government having sold Telstra to unassuming and fundamentally trusting community as investment opportunity can now be seen as being sold a dog.
I refer the government in general here rather than one side of politics or the other because neither can be trusted. It would seem that the beneficiaries of the government strong-arming of Telstra will be its biggest competitor Singapore owned Optus which has a customer service reputation not much better than Tiger Airlines.
This betrayal of trust by government in general is similar to the progressive dismantling of superannuation incentives through the progressive reduction in savings concessions, and ultimately greedy government will get its claws into superannuation savings by ramping up taxation on superannuation benefits having encouraged the community to save in this direction.
Furthermore the so-called NBN ($43 billion profligate waste of taxpayers funds) to prop up ideologicall conviction in the absence of a convincing business case (or any business case for that matter) is another potential blot on the landscape.
Unfortunately the Liberal party is in such disarray that they could not mount a convincing argument for beer consumption in a hot desert, so there is little chance of the government’s policy proposals being seriously challenged.
Oh yes, Telstra shareholders are definitely being screwed here. It’s a win-lose. That is, everyone else wins, and Telstra loses. Telstra (and its shareholders) are being whacked with a big club for overplaying their hand. Nice one Steve C. (Never thought I’d say that …)
And if you bought T1 shares thinking that you were buying into a perpetual monopoly. Well, you just made the same mistake that Sol T made …
@Greg, you have relied in your post on red herrings (superannuation and what might, in a possible future which exists only in your head) to try to support an argument that you don’t trust the government… or, in fact, any government.
Please try harder to stay on topic.
This reform is long overdue and is essential if efficiency and competition, which are eventually the same thing, are to be restored to the telecoms marketplace in Australia.
I do, however, agree with your assessment of the Liberals at present. The country deserves much better from its Opposition.
This is what we wanted and hoped for when voting for a Rudd government. Perhaps there is hope that Wong and Rudd might have a late conversion to sensible policy for the ETS and renewable energy industry? All those who have relentlessly dissed Conroy should at least give some credit where it is due.
The likes of Greg Angelo (1.34pm) need to think about where the nation’s best interests lie, even if Telstra shareholders suffer (though it is Telstra’s amigos who inflicted the most damage to their shareprice; it will be interesting to see where the stock goes from here). Most shareholders have written off their investments anyway and I hope they have learned the lesson that there is no free lunch, even with a government-created monopoly.
As to Optus being the biggest beneficiary, no it will be you and me and all Australian business. The original privatization was the cause so do not go blaming this government for undoing the appalling mess created by the Howard incompetents, who could have spun out competing two or more mini-Telstras and the network separately all of whom would be bigger than Optus today.
I could almost bring myself to cop the censorship regime after this bold move. On second thoughts, no I couldn’t. Nevertheless, plaudits to Senator Conroy for giving us hope for the future of telecomms in Australia.
The most blatant case of insider trading in recent times. Are we to believe that the sale of billions of dollars of telstra shares by the Swan FutureFund just a few days back was not made with foreknowledge of today’s announceent? Today’s announcement has smashed the value of TelstrA shares just as the FF sale did so very recently. Insider trading???
Most OEDC countries that sold off their Telecomunications and Postal entities did so separating the wholesale from the retail. All we did was create a monopoly in a comparatively low population and large land mass and hoped that everybody would be compensated by taking up ownership in the monopoly.
You can have a free market or not, if you are to have a free market then it must have competition. Telstra have been on notice since the failing to make the short list for the NBN. 800lb Gorilla indeed…
Yes, our Future Fund now has a chunk of these devalued shares, and yes, now we are forced to build a new NBN (pronounced “NewTelstra”). Not great.
But selling Telstra as a monopoly (and breaking it up now) while ugly, probably got the best price for the assets for Australians. And it got Telstra off our hands. Have you ever worked with (or for) Telstra? Even with years of job shedding, it is still a bloated sheltered workshop. And always will be while they have the monopoly.
Well done Stephen, it has taken long enough to get around to this. Also those people who are crying foul as shareholders should have a good think about this. Telstra has been trashed and turned into a ludite, which no telcho can afford to do. It has ruined its future development and put itself behind the eight ball when it comes to competing against other organisations. If I had shares in telstra right now I would be jumping with joy after sooooo many years of misery.
Hopefully Conroy gets so distracted now with this new offering that he completely disregards those stupid ideas he had to ‘censor the internet’. (But credit where credit is due…)
Surely the broadband blocking plan was thought up by a bunch of 85 year olds at a Sunday church meeting?
@Angus: I’ve worked for Telstra and I’m not sure that I agree it’s any more a sheltered workshop than any other large organisation I’ve worked for. What I do know is that it was hijacked by would-be entrepreneurs with their ‘new economy’ ideas and total lack of understanding of the company they were supposed to be managing. And that was before the failed telco import took the reins and caused it to deviate even further from the path of profitability.
While David Thodey has a non-telco background, he seems to have a level head on his shoulders and I’m confident he will provide the present shareholders some comfort in the years ahead.
Finally! A little economic integrity is seeping into Government policy. This is real, worthwhile reform….as opposed to the simplistic, ignorant tripe masquerading as prudence that went on over the last 10 years or so (you know the stuff…privatising monopolies abnd calling the job done).
Boy, there are some seriously silly people in this world!!
Rampant competition, aggressive and ‘the devil may care’ free-market forces fundamentalism, is a good thing, right? AND we need lots more of it right NOW!
Well some people must have been hiding under a rock for the last year or two and have missed the ‘near’ death of the World economy caused by fundamentalism, idiot-ology and other misguided neo-con free-market dogmas.
So the way to a ‘win-win’ situation in telecommunications industry is more of the same economic stupidity, greed and wealth destruction we have barely managed to avoid by coming to the rescue with trillions of dollars of PUBLIC funds? Yeah, right!! Get a life, you lot……
If you invest in companies you get ripped-off, if you invest in Government enterprises being flogged off you get ripped-off, if you put your money into super you get ripped-off…so pray tell who is going to fuel all these companies with funds to enable them to compete with Telstra and destroy it? Singaporeans? Mum and Dad savers? Mug battlers? Of course NOT - THE Government will do it all for us using our taxes; good one Sen Conroy - great CON….
Looking back this will undoubtedly be seen as the high-water mark for the Rudd Government. They have lost my vote from here on….
Greg Angelo - Telstra shareholder, are we?
There are thousands of convincing business cases for the National Broadband Network. My personal case is that I can barely conduct high-traffic work from my workplace in a major urban area given current ‘high speed’ connections. In a non-capital city it would simply be impossible.
Your lack of a car does not mean that we have no need for good quality roads around the country. Similarly, your lack of a use for reliable high quality internet does not mean we have no need for such a network. It is fundamental for our future - unless we prefer to simply dig up iron ore ad infinitum.
Telstra is, like most utilities in Australia, a natural monopoly and it should be government owned to allow cross subsidisation of unprofitable services to the bust etc. But the proviso to this is that the government doesn’t use it as a cash cow by either exploiting the monopoly to earn pseudo-tax dollars, or ripping money out of the company so it can’t reinvest in new technology. No government has had the discipline to resist such temptation. Same with water, and rail.
What definitely won’t work is handing a monopoly to a private company - because they definitely will exploit it to earn excess profits. They would be negligent not to. That is bad for everyone who uses the service, and whose business depends on the service. Same with electricity, and airports and trams.
While I feel a tad sorry for Telstra investors, I only feel a tad sorry. Its called regulatory risk, and if you bought shares in a company that has hundreds of pages of legislation devoted solely to how it should run then you were had. There was no government guarantee to look after this share for the rest of all time and, if you handn’t noticed, the share market is a bit risky.
What I hope now happens is that wholesale access to the line infrastructure can be priced competitatively without having to actually do business with Teltra. This includes removing all the mysterious obstructions to getting competetive service, such as the mysterious unwillingness to install ADSL switches in exchanges.
O frabjous day! Callooh! Callay!
The first sign of a rational approach to sensible management of our costly telecommunications infrastructure since the privatisation of Telstra was first mooted.
Many shareholders such as myself bought and retain shares only to be able to retain some minimal influence. If we lose value in the shares we should gain value in the ability to move about Australia while retaining usable communication speeds.
We now see some possibility for more efficient use of scarce capital and operating resources by reducing wasteful duplication in high profit areas. Add potential provision of improved services in areas where simple dial-up internet access can no longer load a home page in an acceptable time.
18 comments after just over 2 hours, and counting.
Only two of the contributors are against Conroy’s proposal and they wrote stream-of-consciousness rambles which defy rational analysis.
It seems that Minister Conroy has hit the mother lode with this announcement and that he has something close to 90% of popular support.
Now, who says that the current government has no real policy and is only prepared to take easy decisions?
I can’t wipe the smile off my face. It’s too early in the day for a celebratory beer, but living as I do in the country, I am mightily encouraged by the prospect of improvements, any improvements at all, to the speed, reliability or price of communication services. I only eventually got broadband from Telstra after almost 4 years of paying for a service which was not provided, and after so many twists and turns that I almost gave up altogether. Nice it was to get the eventual four figure refund.
Telstra shareholders take note: This stupid conglomerate even insisted that I accept double refund, having denied that they could make such an accounting error… SAP is a large, German accounting package, etc, etc. Eventually, and after several times in writing telling them of the error in my favour, I accepted the second refund.
If Telstra cannot provide contracted services and then gives out duplicate refunds, how can they make a case for being able to run a real company?
Whoever cames next will be an improvement.
@Perry: Interesting point. But are you really saying that pre-Sol Telstra (government owned, then not) was not a bloated monstrosity? And David Thodey now has a gun to his head, so he has to play nice. And I’m not sure that providing ” the present shareholders some comfort in the years ahead” will make shareholders feel better when the share price goes through the floor. That’s Telstra thinking
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@Spare Us: We are all Telstra share owners (through the Future Fund). But are you seriously arguing that splitting Telstra is somehow equivalent to letting big banks fail? Does the world revolve around Telstra? Are we about to have a broadband (as opposed to liquidity) crunch? Please.
@John, I agree with your sentiments, but I’m pretty sure that:
- 20 comments is not statistically significant;
- Crikey comments are not a normalised cross-section of the community; and
- 3 of the comments are from me, and I am a right-wing nut bag.
I am glad Conroy has the guts to take this step. I suspect Helen Coonan would be cheering from the sidelines but is not allowed to say so.
Yes, it is the shareholders who will cop it in the neck for this but the move has been telegraphed for a while now so there were chances to get out, unless you took a punt that Telstra would get its way.
As other have said, the separation should have occurred when privatised. I believe the govt of the day had valuations put on both scenarios and opted to flog the one that had an in built premium for being a virtual monopoly. While at the same time claiming to be champions of competition. Where is Dicky Alston now?
Effectively the premium for being a monopoly will now be removed from the share price, along with being discounted over the last few years for the crap management.
I still laugh when I hear Sol’s claim to fame that “total shareholder return out performed the ASX under his managment”. Of course he can only make this claim by including dividends, but money to pay the dividends was borrowed, it wasn’t paid out of profits. You need to be a genius and be paid $30M to be able to do that. Well at least pull it off anyway.
Try using the internet the otherside of the Great Dividing Range. Twisted Pair copper wire, dialup speeds. That’s the internet the other side of the Divide. NBN is the infrastructure we need and we need it for all Australians not just for the Boomerang coast and Perth.
Would love to be able to review all the emails between Swan’s office,Treasury, and the Future Fund. Unless Conroy dreamed this up yesterday while hitching a plane ride home with K Rudd, one would have to think it has taken many weeks in the preparation. It’s only a couple of weeks since the Future Fund flogged off 2 billion shares, and that looks mighty like insider trading at a level that would land most of us in the slammer.
It need not screw shareholders. I own shares in Telstra pre-breakup, I end up owning shares in Telstra plus TelstraNetwork after. Asset value should be the same, but TelstraNet won’t be able to give mates rates to Telstra. Really, the Hawke/Keating government should have done it this way to begin with.
Why are so many convinced that Telstra shareholders will be worse off? Splitting Retail from Wholesale will presumably result in revised shareholdings and, if we’re to believe in the merits of competition and the NBN, I would see value gradually accruing to both companies.
@Angus: At one time Telstra was close to 90,000 employees, following the merger of Telecom Australia with OTC, so bloating was unavoidable and the unions weren’t in a hurry to see their members out of work. Those numbers have reduced substantially since - along with customer service and innovation - but don’t forget to add back the staff in all the functional areas that were outsourced.
For those who suspect some skulduggery and possible insider trading by the Future Fund on this. I think I would have to say go and have a lie down. While conspiracy theories are always tempting , avoid them as a first resort. Anyone who takes more than a passing interest in the Telecoms industry, (the future fund as a holder of a few billion would qualify here) would have realised this was a possibility and would have taken a defensive position. You did not need inside information to realise the govt wanted Telstra broken up.
Conroy may or may not be your favorite minister but he is not a complete goose. He would have known, especially after Godwin’s flight of fancy, that there are whistle blowers who could expose any underhand dealings.
@Angus Sharpe. Correction…we were all shareholders. FF got a large tranche of shares away just before this announcement…..No! NOT big bloated banks, but very skinny Mums and Dads who bought T1, T2 and T3 believing that little bloke they called ‘honest John’, the greatest Liberal since Menzies…spare me, please!! The lunatics are back in charge of the asylum…or should that be still?
I guess the ‘mug’ punters aka the Australian Public are just there to be ‘farmed’ and milked by the free-marketeers with some serious financial help from the Government politicians. In case you missed it….Telstra, for all its silly faults - and it has many as do political parties - is the only…ONLY ….organisation technically and financially capable of doing the NBN, however, the Government is too stupid and bloody minded to see that.
So now we have yet another ‘start-up’ Government Telco DIRECTLY competing with a free-market forces entity using billions of public funds to try and break it - Mr and Mrs Average vs the Government - a great way to move this country forward. We could use the same ‘business’ model for the 4 banks, Coles, Woolies, fuel companies, Bunnings, cake shops, cattle farmers, hairdressers…..we could do it all! Yes, how good would that be? Russia and a few others tried that some many years ago…..take it from them…’IT does NOT work’. Somebody needs to remind Sen Conroy of this simple fact….
The BIG loser in this? Not Telstra shareholders…but actually the Rudd Government….simply NOT up to this task of Nation building, not even Nation minding. Mind you nor is the other lot. Maybe we could import a few sensible politicians as well?? Can’t seem to grow any at home…
@Perry, good point, but Telstra is still monumentally bloated. Even after the regular cuts post-privatisation. And the outsourcing actually helped. Nasty nasty shock for the Telstra employees who went across to the big outsourcers. Finally, not to be rude (you seem sensible and smart), but “customer service” and “innovation”? From Telstra? Are you serious? Can you name one post-Telecom Telstra innovation?
@Spare Us, you make good points, especially about mums and dad shareholders, but we can’t let that hold us back forever. And you have been listening to much to Sol if you think that only Telstra, of all the companies in the world, can roll out the NBN. And I agree with your point about the NBN, but the NBN is a far better stimulus spend than pokies and flat-screen-TV payout checks. It’s infrastructure. Like roads.
Should we let Telstra hold us back forever? Unfortunately, Telstra has demonstrated that they will not change without the government putting a gun to their head. That’s what Stephen Conroy is proposing to do. Let’s see if (a) he has the guts; and (b) if Telstra makes him pull the trigger.
@Angus: Telstra Labs was innovative, but it suffered severe cutbacks too. I’m not sure it even survived.
BTW, I didn’t join Telstra from choice - I, along with my partners, was acquired during the Ted Pretty days 0f dot-com startup buyouts.
Having reviewed the various contributions there seemed to be a large number of people in favour of the NBN who choose to live in locations well away from urban infrastructure and expect a socialist government to provide a “road to every door”. Perhaps the same people should also be campaigning for rural roads as well as price and the service equality in rural supermarkets and fuel outlets.
The business case for the NBN has not been made. As a pork barrelling exercise ther NBN would make John Howard look honest by comparisonn if it is carried out in its initial form. The government to carry out its objectives needs Telstra’s infrastructure which it will force Telstra to provide without consequence to the impact on Telstra shareholders. This is nationalisation by stealth.My comments in relation to trusting governments I think is well founded as the various levels of stupidity related to school infrastructure which have been recently disclosed with referring to to the various lies and deceit peddled by the previous government.
I would be much more sympathetic to the government position if they would take a similar position with oligopolistic service providers like Woolworths and Coles, and the big fuel retailers who by some magic process managed to flex fuel prices in Melbourne without breaching any competition rules. I would be really happy for the ACCC to target these situations as well.
Essentially the government is proposing to finance, using taxpayer’s money, a parallel infrastructure unless it can bludgeon Telstra into submission. This it can do via legislation, which is essentially destroying shareholder value. In the interests of the common good perhaps they could also commence the process also with supermarkets and petrol retailing.
Yeah about time, small cheers for Conroy but I’m not too enthusiastic. As a few ppl here have said the case for public ownership of the NBN given its monopoly situation is persuasive, when Conroy makes that pitch I’ll get a bit more excited.
If I ever have to deal with the incompetence and mismanagment of Telstra again I will start breaking things instead of just screaming at Voice Recognition systems that do not work. The fact that no one inside Telstra seems to know what any one else does is bizarre.
If this move changes anything so be it. I won’t hold my breath.
I’d rather deal with Centre link.
I agree with Greg Angelo.
This will have many unintended negative consequences as well as the obvious of the shareholders who bought in good faith off the Commonwealth and have now been deceitfully short changed.
I note Bernard Keane doesn’t even bother even alluding to even one of them.
His pretense as as a serious political reporter has for quite some time been no longer deluding me.
John Bennetts said: “If Telstra cannot provide contracted services and then gives out duplicate refunds, how can they make a case for being able to run a real company?”
Such cockups are not the preserve of Telstra. All of the big telcos have billing systems that are what programmers like to call “plumber’s nightmares” — meaning that they have been hacked and patched so often in order to keep up with the byzantine billing plans currently on offer and all of the active historical ones, too, especially for business customers — that nobody can debug them.
The companies that offer to audit your business telecoms invoices can usually find billing errors in your favour and the telcos generally don’t fight their findings.
So, been in discussions for some time eh? And the Future Fund got wind of it? Of course not ………………..
As a shareholder in Telstra this is the second time I have owned this company.
First as an Australian citizen, and now as a shareholder in a public company which struggles under the interference of Mandarin speaking Communist China worshipping limp wristed pencil necked pale faced temporary public servant.
If you superimpose the map of Australia over the map of America and see Cape York up in Canada, Melbourne in the gulf of Mexico, Hobart on a level with Cuba, Cape Carnarvon where SanFrancisco is and Washington near Bundaberg and realise that the June 1st. 1850 Census in America put the Yank population at just over 23 million you have to marvel at the fact we have a national system at all here in sparsely populated Australia.
I hate Communists.
The Govt doesn’t ‘own’ anything, we the people do, and elect these pricks to administer house keeping. They fail.
Australia needed co-operative development of just about everything. Which is why we have the tax system of distribution currently.
This whole idea that Govts shouldn’t be caretakers for public owned assests is like saying we don’t need ASIC. You need regulation of narcissistic greedy predators whether private or Govt.
Govts are temporary caretakers of the Australian constitution, with ning nongs elected under sufferance to preside over the mess they make while we go about the business of getting around the stupidity that Govt emits and raise families despite Govt. and not because of them.
The Globalisation experiment is to fail. There will be a massive depression. People will starve. Then there will be the usual huge gobal bust up called war. Australia will likely be divided up or massively fought over because of all the stuff that was laid down four and a half billion years ago that we have been giving away to the commos in China. For nothing.
How you can run up an enormous trade deficit during the boom is why Govt. should lay off Tesltra. They getting nothing, absolutely nothing right!!!!!!!!!!
Great news for consumers and competition. It was short sighted and lazy of the Howard government to privatise Telstra without first breaking it up. Telstra cannot be blamed for acting like a monopoly when they have had every incentive to.
It’s fantastic to see some steel balls being affixed to the competition regulators of our country. Next up, supermarkets, petrol, and the media!
@Jeebus, It was shortsighted and lazy, but it was the Hawke/Keating government that started the sale with T1 and T2. Howard merely continued what they started.
I agree with Greg Angelo.
This will have many unintended negative consequences as well as the obvious of the shareholders who bought in good faith off the Commonwealth and have now been deceitfully short changed.
I note Bernard Keane doesn’t even bother even alluding to even one of them.
His pretense as as a serious political reporter has for quite some time been no longer deluding me.
@Meski, you’re incorrect on that mark. It was the Howard government that privatised Telstra via T1 in October 1997 and T2 in October 1999.
source - http://www.aph.gov.au/library/Pubs/chron/2003-04/04chr03.htm#first
I won’t deny that Labour played a part in the botched process by introducing “competition reforms” that created a protected triopoly between Optus, Telstra, and Vodafone during the 90s. Both parties convinced themselves that this gave us a robust telecommunications industry, when it was anything but.
Telstra could have been structurally separated with little controversy or conflicing interest up until its privatisation, and I remember a lot of voices from the technology industries were calling for it. Unfortunately the economic rationalists had the ear of government, and pork whispers won the day.
Dear Bullllmore’s Ghost,
I did not engage an external auditor in order to trick Telstra. They did it all by themselves. Several times, I advised them that I did not require a double repayment of the refund. They simply refused to correlate my account with BigPond and my phone account, which were merged during a promotion of single billing. Unfortunately, my computer has since failed , else I would be tempted to contribute full details of these messages. Memo to self: Must back up files more often.
No amount of explanation would convince those in charge of the two separate billing systems that there had been a double repayment.
An hillarious side issue was the fact that no account could be transferred between the two (BP and SB) with any balance except ZERO dollars and ZERO cents. I, of course, had a balance which was approximately -$3k. The only way out seemed to be payment by Telstra to me of the balance so that the merging of accounts could take place, after which the credit was again discovered and so the story continues. Double repayment.
The relevant Group Managing Director (nice title) was contacted. Too hard. Emails and a snail mail message ensued. No result.
Eventually, I gave up, drank the proceeds and now live happily ever after.
By the way, I am a simple family man, a private citizen with a phone line or two and normal needs for communication. Nothing fancy. Nothing pretentious. Just an overcharge, twice refunded.
I am not hiding behind an alias. My name is able to be traced very simply. The fact is that, as a country customer of Telstra, my experience has demonstrated that this company is unable to run a chook raffle, a billing system or a phone company.
Telstra shareholders, how do you feel? You own shares in a lemon. It is cactus. If the government’s current actions cause you concern, it is too late. Your past management have demonstrated their inability to run this company. Your money has already gone down the toilet. The current actions are in response to Telstra’s demonstrated failure, not because of some imagined antipathy to private ownership.
Folks, you have backed a loser and the time to settle the score is approaching.
Great job, Senator Conroy! Get on with it!
So let’s get this straight:
In the short term the Future Fund basically front runs the market and dumps Telstra (I can already hear the naysayers cry ‘Chinese Wall!’).
In the long term Telstra gets smashed into pieces so that in five to ten years time our information technology infrastructure will be owned by foreign enterprises because the domestic firms lack scope, scale and a knowledge base to perform the job.
Are there any other industries we can nail to the cross of competition? Perhaps an ACCC witch hunt can destroy our mining industry, banking perhaps? Don’t forget our retailers!
What a bright future for our children lots of tiny companies with no ecomies of scale trying to compete with global behemoths.
Lots of competition but sorry guys Australian companies will be to puny to win the race.
Fantasic- Thankyou Kevin Rudd!