Telstra might finally its day of reckoning

Posted: March 20, 2009 in society
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The corporate regulator is suing Telstra for blocking access to its competitors such as Optus, Primus and TPG. The company is legally required to give competitors access to its exchanges so that they can install equipment to provide voice and broadband service to their customers. In typical Telstra fashion it seems that the company claimed there was no room for those installations, a claim the ACCC rejects as having been false. The regulator also alleges that Telstra engaged in misleading and deceptive conduct by posting notices on its website, listing exchanges that supposedly had no room for competitors’ equipment. In a suit filed in the Federal Court in Melbourne the regulator accuses Telstra of having contravened the Trade Practices Act through its actions.

The timing for the court case is interesting; it comes two weeks before the Federal Government is expected to reveal its preferred tender for the 10 billion dollar-plus national broadband network. Telstra was excluded from the tender process because it refused to provide the appropriate documentation. That failure as well as the court case might bring Telstra closer to not just remaining shut out from any chance of building the network but also getting closer to having the government structurally split the business. Telstra’s shares fell yesterday to an all-time low.

The top rats are leaving the ship. Most of the American executive cowboy team, named the amigos, have left (although some of them still receive consultant’s fees!) after it became clear that their confrontational course failed and amongst other things led to a strong decline of so-called shareholder value. CEO Sol Trujillo will leave a year early in May, with a 13 million plus dollar golden handshake (as failed CEOs tend to do). All this is just another case of corporate rip-offs that customers have to pay for with overpriced charges. One can only hope that Labor will do at least one good thing during its electoral term and break up the company.

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