Telstra's newest product ... groundhogs

Telstra's newest product ... groundhogs

Summary: Bill Murray's weeks spent in the purgatory of Punxsutawney, Pennsylvania -- depicted in the amusing movie Groundhog Day -- have become a cultural sounding point, mentioned in passing to describe a situation where someone is stuck in the same painful, unresolvable situation day after day.

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Bill Murray's weeks spent in the purgatory of Punxsutawney, Pennsylvania -- depicted in the amusing movie Groundhog Day -- have become a cultural sounding point, mentioned in passing to describe a situation where someone is stuck in the same painful, unresolvable situation day after day.

It's an apt analogy to describe the latest news that the company is actually suing the government -- telecommunications go-to person Senator Helen Coonan, to be precise -- for access to documents elucidating the process by which the Optus-Elders backed OPEL consortium was awarded nearly AU$1 billion in broadband funding.

Coonan quickly hit back, calling Telstra's court action 'sour grapes', and of course that's what it is.

Telstra has repeatedly proven sour about anything that threatens to pry away its death-grip on Australia's local loop, so legal action is hardly surprising.

If it weren't so sad. Sad, I say, because Telstra for years was seen by millions of Australians as a national asset -- a carrier owned by the people, for the people.

I know this because millions of people poured their hard-earned savings into three successively poor investment offerings that gave them a share in an ex-monopoly provider that had nowhere to go but down.

Unless, that is, it made proactive, strategic decisions to expand its business in growth markets.

You know, growing its business by offering innovative new IP-based services that would leverage its cutting-edge nationwide backbone, growing its market by extending new services to all Australians and delivering the dream into which Australian mum-and-dad investors poured their hard-earned cash.

There were so many possible directions for Telstra to head in that this downward spiral in which it has now gone -- which repeats itself every day -- has finally progressed from the bizarre to the absolutely spiteful. Watching Telstra's actions in the marketplace is like passing an accident on the highway: we hate to watch but can't turn away.

Now, the company plans to spend untold amounts of those mum-and-dad investors' dollars suing the very government that handed it the monopoly.

This is likely to be a protracted, expensive, painful and ultimately fruitless exercise whose outcome, in a best-case scenario, would be dismissal of Telstra's claims.

A worst-case scenario, however, would see the OPEL decision nullified and a completely new tendering process initiated -- and this would be the right thing to do if Telstra's allegations of procedural favouritism are proven correct.

Whatever the outcome Frankenstein's monster has truly come home to roost, taking on the very government that empowered it. But the victim this time, apart from the government that created it, is once again likely to be the Australian telecommunications market.

Surely, there must be a point when Telstra -- which carries itself with an indignant air as if it had the moral majority and the support of the entire world -- will realise that all this to-ing and fro-ing is just not getting the market anywhere.

Whatever happened to the dream? Who knows. But with the damage Telstra has done to its goodwill, the ownership and sense of shared destiny that Australian mum-and-pop investors once felt must be all but gone.

We will all welcome the day when Telstra simply gets on with the job of capitalising on the opportunities it has been handed, and doing so in a fair way. But until then, we're all stuck in Punxsutawney.

Topics: Broadband, Telcos, Optus, Telstra, NBN

About

Australia’s first-world economy relies on first-rate IT and telecommunications innovation. David Braue, an award-winning IT journalist and former Macworld editor, covers its challenges, successes and lessons learned as it uses ICT to assert its leadership in the developing Asia-Pacific region – and strengthen its reputation on the world stage.

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7 comments
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  • You have missed important details

    The assertion that Telstra has been a poor investment isn't completely true. For example, T3 installments haven't performed badly; they've outperformed the S&P/ASX200 for much of the last six months. The company is also making fairly healthy profits.

    Also, if the courts throw OPEL out, would this not be Telstra's fault but Helen Coonan's for implementing a flawed process in the first place?

    Telstra are behaving in a very ugly way, but don't they have a fiduciary responsibility to their shareholders to ensure good returns - presumably by maximising profit? To put it more bluntly, what did the government *expect* would happen after Telstra was privatised?

    As others have pointed out on this site, perhaps we wouldn't be in this mess if ownership of the network had been kept public and only the remainder of Telstra had been privatised.
    anonymous
  • Who wants to own everything?

    Who wants to own everything?

    We do Chucky, we do.
    anonymous
  • All too true

    Some would argue Telstra is making fairly healthy profits by keeping prices high and underinvesting in its core network. Whatever the reason, you're right -- it is delivering good returns for shareholders. The thing to remember is that millions of those shareholders are also customers, and those profits are actually coming straight out of their own pockets. In this cyclical perspective, Telst'ra's highly selective network investment is actually stiffing its own customers and investors.

    Re the split of the network, I have also argued this point -- but of course there is little to do about it now. The challenge is to move forward, and Opel's bid -- whatever the problems some may feel it presents -- is at least a way of doing that. But if Telstra is successful and the contract is somehow rescinded or even just delayed, isn't that just another win for the intertia that has plagued this market? If Coonan can't defend the process successfully, it will be just another sign that Telstra has the entire market over the proverbial barrel and that change will only ever come at its pace. And that's just a shame.

    Anybody out there familiar enough with these sorts of arrangements to be able to make an educated guess as to the outcomes if the conduct Telstra is alleging, proves true?
    anonymous
  • Rethink needed.

    It is really time for all those people with barrows to push, with vested interested or maybe just a pathological dislike of Telstra to take stock, look at the real world, and rethink their opinion.

    I can understand opponents who see their investments in danger of being usurped by a bigger (and better) opposition and in desperation may turn to a fruitless campaign of insult. But this is childish and self deluding.

    It is an undeniable fact of international business practices that to be competitive, and successful, company management must use all legal resources available to them.

    Telstra is duty bound to challenge the unfair decisions by Government who try to force Telstra to supply a false competition to their opponents advantage and at the expense of Telstra. Telstra seeks a "fair go" and that is what our legal system is for, to ensure that justice is available to all.

    It may be necessary for Telstra, and in their best interests, to examine closely the Labor proposal to partner (hopefully an Australian) company to give Australians the fast fibre broadband they demand. If this became a reality it would end the monopoly argument and the need for the ACCC actions for all time.
    anonymous
  • Cutting edge? As if

    The majority of Telsta's network is not cutting edge, it's the result of decades of government neglect, on both sides of politics and a lack of forward planning.

    ADSL 2 enabled exchanges can't provide this connectivity to locals because overall the network is too poor to provide that level of service.

    After years of neglect, the government's best plan is to allow Optus and Vodafone to cherry pick profitable customers and leave the bush to fry in the hot summer sun.

    Why foreign companies are allowed to steal money from the bush is beyond me.
    anonymous
  • Telstra's newest product ... groundhogs

    Telstra seeks a "fair go"
    Telstra seeks that which itself isnt pprepared to give, as it already has an unfair advantage over anyone (the infrastructure).
    Telstra Wants is current excessive margins to be enshrined into reality via its FTTN proposal so that it can then charge even more profit INCREASE
    on top of that.
    Howard stupidly believed that telstra would do the right thing and work with the industry.
    Due to Telstras current corporate attitude even MORE regulation is required not less.
    Opel must go ahead so that pricing wont go thru the roof like telstra wants it too.
    Opel would force the prices to remain reasonable for the consumer.
    anonymous
  • Cutting edge? As if

    >After years of neglect, the government's best plan<
    the Government best plan is to get Opel signed up on the dotted line and get it running.

    <Why foreign companies are allowed to steal money from the bush is beyond me.>
    So none of telstra's profits goes overseas then !
    anonymous