Graeme Samuel's take on the Telstra split

http://www.abc.net.au/news/stories/2009/09/16/2687294.htm?section=justin

I hadn't read this article before I posted, but Peter Swan puts my case pretty clearly: "Rudd playing Ned Kelly with Telstra" http://www.theaustralian.news.com.au/story/0,25197,26078850-7583,00.html.

I don't think it matters what you think of Telstra, governments are not entitled to change the rules just because they want a benefit. It's theft pure and simple. If they behave like this to a behemoth with thousands of mum and dad shareholders, and therefore some political clout, imagine how they will behave to organisations or individuals without clout.

And when it comes to monopolies or quasi-monopolies, you're better-off with them not being government-owned. Once they are government-owned the government has a financial incentive to squeeze out potential competitors. (And potential competitors includes better technologies, not just other companies). When they're not government-owned there is generally no financial benefit to a government who owns them, or whether a successful competitor comes along.

Remember how bad Telstra was when it was a government monopoly? That's where we're heading again.

I used to buy Optus products on the basis that competition would be good for Telstra, but if anything I found them to be worse. Their call centres are all overseas too, it seems. So we went back to Telstra for our office phones earlier this year. First time I've bought anything from them since Optus was allowed in.

*I’m not sure you will get much sympathy either from non-share owning Australians*

I've got news for you! There would hardly be an Australian who does
not have money in a super fund and there would hardly be a super fund
who does not have some shares in Telstra. So the Govt is screwing
the lot of you, but you are seemingly not smart enough to notice!

Graham is quite correct, its basically a scandal. First the Govt
flogs off the telco for top $, then they change the rules.
As we've seen so far, most Aussies won't even notice.

So politicians might well get away with it. Luckily for me I
have very little faith in politicians and given that Telstra's
future depends on them and their rules, I kept my interest in
Telstra at a minimal level, just enough for the divies to pay the
phone bill.

i never changed from telstra...because to leave it could jeperdise my claim,...[ongoing claim..from when this public utility was privatised

the biggest crime was giving the in ground ''pipes''away to foreign agents..that these pipes be returned is a matter of urgency...futher that the income from wholsale pipe acces..benifit the people

i feel telstra got a free ride for [8years]..that the next telco cooperative..have the franchise for 15 years[or so]...subject to the improvement of the public asset..to wit laying the system with imperrishable glass fibre to the home...

[as well as a public phone/internet acces from say phoneboxes...a quick timed free log in of a few minutes..or longer for money

Graham,

From the point of view of an honest and genuine investor you're right, it is theft. On the other hand, from the point of view of the consumer, I think it's fair to say that any shakeup that gets rid of Telstra's monopoly is a good thing. It's a classic case of one man's meat is another's poison. That's what Samuel is referring to when he talks about the mis-alignment of shareholders' interests with consumer's interests.

I'm not a shareholder at all, so I'm on the side of the consumer in this case (at least on the face of things, consumers will be better off by this decision). But I can imagine, and understand, that some Telstra investors will not like it. I hope that competition really does improve as a result of the Government's decision and is not just a false bottom in a suitcase as you suggest.

"I've got news for you! There would hardly be an Australian who does
not have money in a super fund and there would hardly be a super fund
who does not have some shares in Telstra. So the Govt is screwing
the lot of you, but you are seemingly not smart enough to notice!"

Yabby,

Don't super funds have a large portfolio of investments? At any point in time they back winners and losers on the stockmarket whose fortunes are basically in a constant state of flux. Super funds win here and lose there but basically mostly manage to come out on top. How do you know whether the Telstra decision won't make another competing/symbiotic business or industry more profitable as a result, which the super funds will jump straight onto?

You're forgetting that super funds have the advantage of not having to put all their eggs in one basket!