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The Telstra break-up smoke screen and the NBN.

September 16th, 2009 · Greg Atkinson · 36 Comments

If you think that the Government’s plan to break-up Telstra is aimed at giving consumers a better deal then you are thinking just the way they want you to. The real reason the Government wants Telstra weakened is so that it’s poorly planned National Broadband Network (NBN) has an easier path into the broadband market.

Of course as soon as news spread of Senator Conroy’s strong arm tactics against Telstra, a whole range of market experts, analysts and journalists were heralding the dawn of a new era in the telecommunications market in Australia.  Lower prices and better deals for consumers were just around the corner they exclaimed, even though we have little idea yet how exactly any separation of Telstra will work out in detail.

Telstra is a big company and the market leader in the telecommunications sector in Australia. As with many other former government owned telecommunications monopolies across the world it was privatised and the sector was gradually opened up to competition. In Telstra’s case it has been fending off competitors since the 1990’s and gone through three phases of privatisation via T1, T2 and T3 where ordinary investors were encouraged to buy into an Australian icon.

It is easy to look back now and say that the privatisation of Telstra should have been done differently, or it that should have been broken up further  but at the time there were a lot of complicated issues to deal with, including how these measures would affect the tens of thousands of Telstra workers. Maybe the way Telstra was privatised was not perfect, but it was hardly a failure either.

The fact that there is a second large telco in Australia, Optus, is proof that the market is open and competitive enough to allow a foreign owned company to operate in the sector and make healthy profits. In fact Optus often provides some of the best returns that Singtel (the owners of Optus) receives from any of the markets it operates in.

So clearly despite all the rambling in the press and even by consumers, there is a reasonably competitive telecommunications market in Australia. Could it be more competitive? Of course. But so could most other areas in the Australian domestic economy.

One major reason prices for broadband and mobile services in Australia are high is due to our relatively small population and large geographical area. 21 odd million people is not really enough to support 3 0r 4 major telecommunications companies and there is an also a lot of area that needs to be wired up if you want to reach anything like 95% of the population.

The recent merger between Three and Vodafone Australia for example highlights the fact that the Australian market is unable to support 4 large mobile network operators. So it is not just simply a question of having plenty of companies in the sector, there also needs to be enough customers to go around to create real competition.

But I hear people say that of course greater competition leads to lower prices. They argue that if Telstra is broken up and other companies have access to Telstra’s infrastructure then broadband prices will fall. Maybe this will happen, but don’t count on it. At the end of the day someone has to invest in the infrastructure and be able to make a good return on this investment.

We can get some insight into how the broadband market might have evolved without Government intervention if we look mobile telecommunications market in Australia. In this sector Telstra has no major advantages and was was not even the first to launch 3G mobile services. Yet Telstra remains the market leader in the sector, offers competitive products and it’s other competitors have their own networks and thus have no major issues with access to the Telstra network. (yes calls may need to move through the Telstra network but this clearly does not hurt Optus)

The mobile area is also interesting because it is one where the Government has generally limited it’s role to handling spectrum issues and let the private sector get on with looking after the business side of things. This means Australia has a number of advanced mobile phone networks and fairly competitive prices when compared with other OECD nations. So if the Government took the same approach to broadband why couldn’t the same outcome be achieved?

The truth is that broadband in Australia is lagging behind many other countries because the market is yet to reach critical mass in terms of subscribers, but when that does happen Telstra, Optus and others would (and already have in some areas) push ahead and deploy higher speed broadband networks just as they pushed ahead with Cable TV. (CATV)

It is probably because of the major losses made in the early years of CATV that companies have been reluctant to push too aggressively with broadband infrastructure and have been waiting for demand to pick up. That may not be an ideal situation for many consumers but that is the way business works.  If the Government simply got out of the the way, higher speed (true) broadband would spread across the nation (where there was demand) without the use of $43 billion dollars of taxpayers money.

I know it is almost a national sport to bash Telstra but it has been a a pretty successful company and one of the few large technology related enterprises we have in Australia. This is quite an achievement when you consider the company has in recent years been overseen by a lacklustre board and run into the ground by Sol Trujillo. I actually feel sorry for the people who work at Telstra, who despite years of poor executive management have struggled to move the company forward.

So let’s see this latest attack on Telstra for what it is: a smoke screen.  Senator “Cyberman”  Conroy has managed to get himself into another precarious position. First he cancels the previous broadband rollout project initiated by the former Howard Government, he then manages to mess up the tender process and therefore to save face decides the Government will take over Australia’s broadband future. Along the way he attempts to censor the Internet and has now also probably worked out that his NBN venture is likely to be a flop unless he can force Telstra to cooperate.

So is the Government’s move against Telstra aimed at giving consumers a better deal? Of course not, it is aimed at trying to save one of the most poorly conceived and planned projects in the nation’s history, the National Broadband Network. (or as it should be called: the Not Bright Network)

I would expect Telstra, in the interests of it’s shareholders, to defend it’s rights and not allow the Government to dictate how it should conduct it’s business operations unless it has broken the law. This is not just an issue about bashing Telstra, this is an issue that strikes to the very core of what free and open markets mean.

How can companies, business owners or investors have any confidence in the future if the rules may change depending on how the Government feels?

Yes Telstra as a company has faults, as all companies do. Yes many of us have sat on the other end of the phone and been frustrated by Telstra customer service at times. But let us not be fooled into thinking that the Government’s actions are about helping consumers, they are not.

The Cyberman’s plans for Telstra are simply a way to remove an obstacle in the path of the NBN broadband monopoly. Instead of greater competition in the broadband market consumers will be left with essentially once choice: Rudd and Conroy’s NBN Co. How exactly that will create greater competition and drive prices lower is a mystery to me and should be a question all Australian should be asking.


36 responses so far ↓

  • 1 Jono // Sep 16, 2009 at 2:14 pm

    wow.. a great balanced article THANK YOU! ive been reading so much sh*t about this.. lovely read indeed 🙂

  • 2 Ralph // Sep 16, 2009 at 3:47 pm

    Agreed. The NBN is a mess. It’s all about the politics and ensuring that the NBN is viable.

  • 3 Senator13 // Sep 16, 2009 at 5:45 pm

    It sounds a lot like blackmail to me…

    What about all the T1, T2 and T3 shareholders who purchased shares under false pretences? They were sold a company under the impression that it owned and operated in a market in a particular manner which was legal and are now having the rug pulled right from under them because the Government does not like this particular company very much…

    Also, so much for open and transparent governing that was going to provide detailed cost benefit analysis of everything – they announce this news just before lunch time yesterday and sneak it into Parliament last night… Dodgy…

  • 4 Greg Atkinson // Sep 16, 2009 at 6:09 pm

    Jono thanks, glad you enjoyed the blog. Telstra does seem to cop an awful lot of bad press, maybe it is the old tall poppy syndrome in action?

  • 5 Pete // Sep 16, 2009 at 10:40 pm

    Has anyone here ever dealt with Telstra?

    Possibly the worst company in Australia (besides that asbestos company)

  • 6 Greg Atkinson // Sep 17, 2009 at 8:31 am

    Pete, some of the smaller telcos in Australian have pretty poor reputations and I have dealt with one in particular that was far worse than Telstra.

  • 7 Pete // Sep 17, 2009 at 9:46 am

    I guess each to his own Greg. I have had very few positive dealings with Telstra throughout my life.

    Yet Vodafone and 3 (Hutchison?) have been okay. Although Hutchison uses overseas call-centres (sometimes I wish Telstra would, thats how bad it is sometimes).

    An example of typical Telstra-ness:

    A few years back I rented a new place. Got the phone hooked up with Telstra, and low and behold, no dial tone. So they get a tech out to see what is up. He tells me that the only reason my phone wasn’t working is because Telstra had locked up the line on the off-chance that the previous tenant would want to keep their phone number. The tech said it is really dodgy and all Telstra would have to do is flick a switch to make it work, but they’d rather chase phantom dollars instead of provide service. And worst of all I was charged by Telstra for the privilege. That’s two weeks without a landline for Telstra’s comfort.

    Then there is the ADSL plans. Most ADSL providers in Australia use a “shaping” system and clearly state it. For years Telstra didn’t. And it really caught people unawares. Huge internet bills of $20K for a month of internet is not reasonable. Yes I know everyone should read the fine print, but a large majority of the people Telstra marketed to were the IT illiterate. They don’t know what a megabyte is. And Telstra exploits that.

    Anyway, there are many more gripes like having to call four different times just to change my address (surely they’d get that right?) and that stupid voice system they tried to use…but i’ll leave it at that.

    Generally, I think they are predatory marketers and always focussed on the dollar, not the consumer. Can anyone say anything positive about Sol Tujilo, other than that he has now left?

  • 8 Greg Atkinson // Sep 17, 2009 at 10:45 am

    Pete I wrote a few blasts directed at Sol so I guess you know what I think about him. I have also had some rough dealings with Telstra so I am no fan of their customer service, however I have had also had some bad dealings with some other companies in Australia who also use automated voice systems for handling calls etc.

    If want to sink to an even lower level of service try dealing with some government agencies, but that is another story….. 🙂

  • 9 Senator13 // Sep 18, 2009 at 9:48 pm

    I thought that this was an interesting article and highlights some very good points:

    http://www.theaustralian.news.com.au/story/0,25197,26088078-5013479,00.html

  • 10 Pete // Sep 22, 2009 at 9:45 am

    And this:

    http://www.smh.com.au/opinion/protection-racket-is-bad-policy-20090920-fwob.html

  • 11 Greg Atkinson // Sep 22, 2009 at 10:29 am

    Pete the whole broadband debate in Australia makes the nation look like some primitive colonial outpost. Higher internet speeds are availble in Australia and for most people the higher speed Telstra plans are good enough, just a touch expensive. Given time prices and availability would improve without taxpayers needing to hand-over billions.

    Yes we lag many nations in broadband but have a look at our public transport, we are not exactly leading the field there either. In addition people die in our hospitals on a regular basis because of preventable accidents..maybe that is a good area for Governments to focus on? A slower internet connection might be a pain, but it will not kill you. Our hospital system might though!

    Anyway in many case your computer, virus software, firewall and the remote site you are connecting to are more likely to cause you problems than if you are connected via fibre or copper.

    Yes laying fibre from now on instead of copper makes sense, but just blinding building a nationwide NBN and breaking up Telstra is not going to get anyone cheaper broadband.

    If I was heading up Telstra I would try and offload all those unprofitable areas the company has been burdened with like connections in rural areas and phone booths. I doubt too many companies will want to move into those areas. Do you think some small ISP is going to ever provide field support out at Bourke?

    The truth is that many smaller Telco’s want to tap into profitable areas with low risk and spend as little as possible. If this plan does not work they fall back on the “bash Telstra” routine but as we know from Onetel, not everything that goes wrong in the telecoms sector is Telstra’s fault.

    By the way I have never worked for Telstra and in fact worked for one of it’s competitors in the 1990’s. My experience during that time was that a lot of Telstra bashing was simply an easy way for people to cover their backs.

  • 12 Pete // Sep 22, 2009 at 11:04 am

    Greg:
    Well I think Telstra needed to be split from the infrastructure assets. It should have been from the start.

    But…I do feel pretty fooled (like others) by the NBN agenda of the split. Too busy hating Telstra and not realising why they were doing it. Making assumptions that the Gov is always acting in the best interests of the community is a silly idea really, and I should have known better.

    Mr Conroy is on a bit of a power trip isn’t he? What’s next!?

    I think you are partly right that people won’t want to service Bourke, but I am sure the Gov would offer incentives in time and it would work out.

  • 13 Greg Atkinson // Sep 22, 2009 at 11:17 am

    Pete perhaps the Telstra break-up should have been done differently but I am still not sure how it would have worked any better. At the end of the day you would still have had some company owning the backbone network and that is still a monopoly. Unless of course you split it up further and then how would that work? Telecoms networks are hard to un-mesh.

    Conroy apparently was a bit of a strong arm man when he was in the union ranks so I guess little has changed.

    You are probably right about Government incentives to service rural areas similar to what they do now via the Universal Service Obligation. I guess if they add some money there it might become a good earner for some company.

  • 14 Valda // Sep 27, 2009 at 9:46 am

    So, Pete, you don’t like Telstra. That’s okay. I’m sure others agree (I agree with you), but replacing Telstra with another monopoly called NBN won’t make either of us happy, or any of us happy, in the long run imo.

    Rather than debate this with you, however, I reiterate that what has been done with Telstra can’t be undone. Telstra is no longer owned by government. Conroy is being AUTHORITARIAN, and he was not elected by the people to act that way.

    The MSM has a duty of care to criticize ‘authoritarian’ actions and protect what is called our system of ‘democracy’. This is not happening. NBN should become Telstra’s competitor, not its usurper.

  • 15 Senator13 // Sep 27, 2009 at 10:38 am

    Could the mainstream media be catching on:

    http://www.theaustralian.news.com.au/business/story/0,28124,26125389-14743,00.html

  • 16 Valda // Sep 27, 2009 at 3:26 pm

    P.S. Greg…

    Why was the “previous broadband rollout project initiated by the former government” cancelled? Is it true that there was a Contract in place for this when Conroy took over as Minister? Was a Contract cancelled, and if yes, how much did it cost Taxpayers to cancel it?

    I’ve been looking for answers to these questions for over 12 months. Just curious. Hope you can help.

  • 17 Greg Atkinson // Sep 27, 2009 at 4:32 pm

    Valda a contract had been awarded to the OPEL consortium to build a regional broadband network by the previous Government and then it was cancelled by Conroy just after Rudd came to power. From what I recall the reason it was cancelled was because Rudd & Conroy reckoned they could do better. So they spent millions on another tender process and after this failed miserably, they decided to save face by spending $43 billion of our money to set up their own broadband empire. (i.e. the NBN)

    OPEL was going to take legal action but I don’t think they ever did… I guess if you sue the Government you sort of ruin your chances of getting future work. I also suspect they might have realised (or been told) that Telstra was in the firing line and figured if they kept quiet they would end up bigger winners in the long run.

    An independent inquiry into the cancellation of the OPEL contact, the failed tender process and the current NBN plans would be very interesting, but of course this will never happen.

  • 18 Greg Atkinson // Sep 27, 2009 at 5:49 pm

    Senator some sections of the media seem to be slowly waking up. But most of them still do not understand the technical challenges the NBN will face or appreciate that the NBN operational model is flawed.

    We don’t need an NBN, we need broadband solutions which vary depending on where they are deployed and the nature of the market they serve. This is what the private sector will deliver if the Government simply gets out of the way!

    Everything that Conroy has touched has been a disaster…I wonder if he has actually completed anything?

  • 19 Valda // Sep 28, 2009 at 8:37 am

    Greg

    Thanks for your reply. I guess you have seen this article about the OPEL consortium

    http://www.theaustralian.news.com.au/story/0,20867,21922708-601,00.html

    Doesn’t tell one much. Guess there is a lot of sordid, or underhand, bullying of the private sector going on in government from all sides of politics, and our pollies just get away with it. Very sad and unproductive. Anyway, a Senate Enquiry should happen, not to explore the OPEL debacle in particular, but to bring the whole broadband issue out into the open. Australia just doesn’t need another monopoly called “NBN” instead of “Telstra”. You’re right though; an Enquiry won’t happen, and as you say, taxpayers and the little people will lose out again with very little choice.

    Your articles on this issue are excellent. Surely there are like minded people (Terry McCrann for instance) who can reveal Conroy’s skulduggery. One thing is for sure Governments do count heads or votes and if sufficient numbers become unhappy about this NBN process, even Conroy will back off. Pipe Dream, maybe !!!

  • 20 Greg Atkinson // Sep 28, 2009 at 9:17 am

    Valda isn’t amusing to read in the article you posted that Rudd committed at the time to spend $4.7 billion on broadband. Well that is now up to $43 billion and counting.

    The Government’s move to breakup Telstra has created a lot of unhappy Telstra shareholders and my feeling is the Government may have overplayed it’s hand. Telstra are actually now in the box seat because of the bumbling Conroy as they have legal options to explore and can probably drag out the break-up war for a long time.

    I see today in The Australian that Anton Tagliaferro from Investors Mutual (which holds 500 million Telstra shares) is suggesting it might be time for Telstra to take the fight to the Government and oppose the break-up. If this happens the Government’s NBN plans will be in a mess.

    Personally I hope Telstra fights back. I don’t like to see Governments of any flavour using heavy handed tactics to cover their backs. If Rudd wants to see broadband in Australia then the first thing he should do is get rid of Conroy!

  • 21 Pete // Sep 29, 2009 at 9:51 am

    I stand by my ‘ideal’ that Telstra should have been split when it was sold off.

    But you all do make some very good points and I think that perhaps this is the wrong thing to do after all.

    If the split was isolated from the NBN and any Government gain, then I could understand it. And if the split was ordered 10 years ago, that would have been more beneficial.

    But it looks like Telstras gain from the copper network was fading fast anyway thanks to developments in wireless technologies and the need to upgrade to higher bandwidth infrastructure.

    So this may be a positive for Telstra in that they might be able to shrug off the burden of the copper network so easily, and be forced into a new direction. Perhaps any Telstra CEO/Board would not have the courage to take on a new direction without this push?

    However…as commenters here have mentioned, this is a precedent, and a nasty one at that. If they get away with this, then what is next?

    As for Telstra shareholders…I have no sympathy. Own shares in a distorted company, get distorted results. The whole Sol affair should have been warning enough that Telstra is bad news. He didn’t do it all alone…

  • 22 Greg Atkinson // Sep 29, 2009 at 10:32 am

    Hi Pete – I am not even sure how the break-up of Telstra would have worked all those years ago anyway and even a stand alone infrastructure company would be a monopoly anyway. I think the other Telco’s often use Telstra as an excuse for their own failures. I feel sorry for any share holder that loses money but I did warn people about Sol a long time ago in: Sol’s Magical Mystery Tour of Telstra and bailed out of Telstra as a result.

  • 23 Pete // Sep 29, 2009 at 11:42 am

    I think that the infrastructure company should be run by the Government.

    None of this “private sector price regulation” stuff. Just basic services at basic costs. The Gov could even wear some of the nastier costs (like extra costs for rural services).

    But…it seems we can’t trust anyone with this kind of power. Not the Gov, not private sector…no-one. So what is the ‘least bad’ option that could have been taken?

    I guess that is a matter of opinion…

  • 24 Greg Atkinson // Sep 29, 2009 at 1:18 pm

    Pete I think your suggestion does make sense but we seem to get in the sell-off mood for a while where the Government flogs off assets and then later wonder if it would have been better for the government to have remained in control. I am not sure for example that selling off the airports was the greatest idea in the world and every time I fly into Sydney Airport, I am reminded how the private sector can deliver just as bad customer outcomes as the public sector can.

  • 25 Ralph // Sep 29, 2009 at 4:43 pm

    For what it’s worth, I reckon the base infrastructure (cables in the ground etc) should not also be a retailer. Otherwise, the advantages to the vertically integrated company (Telstra in this case) are too great. So, I’m for vertical separation (or is that structural separation?). I think a company could be in infrastructure or retail but not both.

    Whether the underlying infrastructure is government owned or privately owned, I don’t really care. Although a government owned infrastructure company might be necessary to ensure that commercially nonviable places (i.e. way outback) get reasonable services and don’t get royally f***ed over. When it comes to cables in the ground, I guess a government monopoly would not be such a bad thing. After all, say there were 3 competing infrastructure companies, do we really want 3 parallel sets of cables running all over the place. Surely that’s redundant.

  • 26 Greg Atkinson // Oct 6, 2009 at 9:06 pm

    Ralph it is not such a bad thing to have some redundant cables if they follow different paths and are not in the same ditch. But in some cases you are right, it does not make sense to have a few telco’s run cables on top of each other but then again…the same could be said for a whole range of other areas. For example do we really need all those TV and radio channels?

    Anyway I think people forget that Telstra cannot charge what they want for other operators to use their infrastructure and the whole issue has been a bit of a PR victory for Optus and others. Even where the playing field is fairly level (i.e mobile) Telstra still does well.

    Personally I would like the government to sort out the hospital system first..then worry about trying to take on the telecomms world later 😉

  • 27 Greg Atkinson // Oct 9, 2009 at 1:55 pm

    As I expected Telstra is not going to accept the break-up without a fight as can be seen from their submission to the Senate: http://www.aph.gov.au/Senate/committee/eca_ctte/tlaccs/submissions.htm (Number 88)

    Conroy has made yet another blunder. He needs to get the NBN sorted and yet Telstra can afford to drag things on…..well ..forever really. Let the games begin!

  • 28 DOUG // Oct 26, 2009 at 9:11 pm

    OF LATLEY TELSTRA SUCKS MORE AND MORE

    ive been a customer for 10 years but the last 12 month have been a huge disapointment
    from service to Billing end

    7 days to have a line moved to our new residense we moved 20 meters to a new unit

    to our phone being disconected while we are on overseas holiday with our 3 month old baby ( unpayd bill )
    the bill never arrived guess that dosent matter to telstra

    that they sent our bill to the wrong address

    now again BILL arives on 26/10/2009 payment overdue fees apply disconection on 27/10/2007
    sent to wrong address AGAIN !!!!
    reconection fee apply

    thanks telstra ( not HAPPY )
    we have 2 buissiness mobiles with you 1 landline and 25 GB internet plan
    at a cost of 400 + a month
    give me one good reason not to change supplyer even if the cost is more

    service can only get better
    maby i no longer will be redirected to a NEW
    customer service member 3 to 4 times every time i have to call them

  • 29 Pete // Oct 27, 2009 at 11:33 am

    DOUG:

    I had to call them four different times to change my address.

    By the second time I was being extremely clear about it.

    By the fourth time I was being rude about it.

  • 30 doug // Oct 27, 2009 at 12:11 pm

    if you by any chance are as lucky as i was today
    after douing a bit of looking around
    on the telstra website i found the official buisiness complaint number directly to a competent service operator it suprisingly
    only took me less than 5 minutes to fix the problems unlike the
    normal treatment we all experince when we call telstra 4 operaters later it might be fixed and usaly about 30 minutes to a hour later
    and offen many calls later

    here is the number 132000 when the automated voice comes on
    just say the word …. complaint …
    and be prepared for the quickest service ive experinced in years with telstra

    this dosent change the fakt that i will be changin my servise provider
    as i with a 3 hour reserch have found providers that offer
    better rates on

    ( based on our use )

    home phone

    2 buisiness mobiles halfing the monthly bill

    internet 60 GB plan with 1 month contract
    at the same price as bigponds 25 GB plan 24month contract

    good luck to telstra share holders

    the OP mentions that australia is to small for biger compertision to lover prices here in australia

    wonder how come a smaller country like denmark 5.5 million people have been able to
    push the prices low enough to have had 500 Dkr ( $ 99 aud ) unlimeted mobile phone plans for several years now
    txt and phone calls any time :0
    smaler plans avalible but the teen favorite is the $ 99 plan

    land lines are just about gone as mobile prices are so cheep
    there that not many people use them anymore

    internet = sim with usb dongle
    are the favorite again cheper that a fixed line internet conection in australia

    lets face it telstra is a rip off
    and until people do walk away from telstra
    nothing will happen as they sit high and mighty
    and rake the $$$ in without providing a suffisient service
    compared to what their prices are

    Doug

  • 31 Greg Atkinson // Oct 28, 2009 at 2:15 pm

    Telstra might not offer great customer service and people may feel they don’t offer great value either but this does not mean any government should be able to forcefully break the company up.

    If the government was to start breaking up companies with poor service than where would it end? Who decides when a company needs to be broken up and what are the rules?

    I am not defending Telstra’s customer service, I am just against strong arm government intervention.

    Besides if you look at the TIO statistics, there are plenty of other telco’s/ISP out there that seem to have upset their customers.

    If anyone can tell me what the guidelines are the government is using to break up Telstra as opposed to it being simply an attempt to cover then NBN mess (as I have suggested) then I am happy to stand corrected.

    You know ABC is a monopoly of sorts..shall we break that up? Heck it isn’t even a private company so it should be easy.

  • 32 Pete // Oct 28, 2009 at 7:56 pm

    Hahaha, ABC. Greg, that’s funny 🙂

    You know that is very different right? 🙂

    But I do get what you are saying.

    I just like having go at Telstra, I think they are the embodiment of evil.

  • 33 Greg Atkinson // Oct 28, 2009 at 8:04 pm

    Pete I just like having a go at the ABC 🙂 Actually what I really don’t like is MAP owning all of Sydney Airport..now there is an example of a really poor customer service experience! (and I say this as someone who has an indirect interest in MAP shares!)

  • 34 Greg Atkinson // Apr 8, 2010 at 9:36 am

    Well it looks like even Optus is now getting worried about the NBN: http://www.theaustralian.com.au/business/industry-sectors/optus-sides-with-telstra-in-national-broadband-controversy/story-e6frg9hx-1225851118825

    I think any Telco should be worried about a Government monopoly being set up with no business plan, no clear objectives but with access to a huge amount of public money.

    How does that create competition exactly?

  • 35 Senator13 // Jun 20, 2010 at 1:53 pm

    This is an interesting development: http://www.smh.com.au/business/telstra-signs-transfer-deal-20100620-yosf.html

    Wonder if TLS share holders will vote for it?

  • 36 Greg Atkinson // Jun 21, 2010 at 9:27 pm

    Senator I think this shows that Telstra are far smarter than the Government, especially Conroy.

    Let’s think about it for second. The deal in non-binding and subject to shareholder approval after the next Federal election.

    If the coalition wins the NBN is dead so the deal won’t see the light of day. If Labor wins the deal may still get voted down by TLS shareholders anyway.

    So I would say that Telstra are cunningly just sitting on the fence and waiting to see if Rudd gets the boot.

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