Friday, December 19, 2008

Senator Conroy

Part of the fall out from the Telstra exclusion from the NBN process has been the whole question of what happens next, and to whom.

Following Senator Conroy's media release where he said "Telstra's Board will have to explain to its shareholders why it has decided to sideline itself" there has been a lot of attention to the question of where the accountability lies. Usually the kinds of share price declines don't go unpunished by shareholders.

In today's SMH Matt O'Sullivan has asked a few fund managers there views. It looks like they agree with the Minister, one (drawing on card and snooker metaphors)saying "They overplayed their hand...they miscued badly ... and they are going to suffer the consequences."

However there have also been those trying to suggest that Senator Conroy will also be under pressure, but these stories as far as I can see are all sourced from inside Telstra (though some have come from the CEPU who bizarrely thinks Telstra is their friend). This would be the view I guess if you were like Telstra and believed the only people who could build the network are Telstra, so having Telstra not in the field must mean Conroy screwed up.

This is really interesting. Telstra has convinced many with their "only Telstra has the funds, the vendors and the skills" story. The reality of course is that there are multiple vendors out there and Telstra outsources most of its engineering build work these daya. The funds one is the fun one. Firstly, it is an admission by Telstra that they are the only ones mking a profit - which sounds like an admission of market power. But the rumoured disagreement between the CEO and Board over whether to lodge a bid was apparently due to the CEO being concerned about the wisdom of committing cash i the current climate - though we do suspect he spends more time in the US than here and does confuse the two economies (and political environments).

What's the rest of the substance? Well Conroy has been coming under sustained attack over recent days over the internet filtering plans. The SMH had another item this morning, this time about the reactions online to filtering.

I have my own view that the filtering storm is a bit like the tabacco industry fury over advertising and its encroachment on freedom. I think the industry itself has a lot to answer for in its persistent determination to claim no responsibility.

In other areas of the portfolio there seems to be real progress on Digital Switchover, which could never be said under Alston, Williams or Coonan. There also seems to be both a process and a prospect for decent funding of the public broadcasters.

Those who want to believe that Conroy is under pressure want to ask themselves two questions. The first is whether there is anyone in the Ministry who would want the job or that the PM would want in the job. The second is that there seems to be no other compelling reason for change. As Bernard Keane noted in Crikey One year into the Howard Government and there were already a half-dozen ministerial corpses. That Rudd’s ministry has entirely avoided scandal of any kind in its first year is testimony not to luck, and not merely to Rudd’s control freak nature, but to his knowledge of the pitfalls of new governments.

Meanwhile it is interesting that only a week ago the SMH published a feature on Conroy as the Minister for the Future. Even the current runctions in the Victoria right are unlikely to cause any sleepless nights when Conroy holidays on the NSW South Coast.

1 comment:

Turlough said...

David - it will be interesting to see what happens next.

Turlough Guerin I Group Manager Environment I Telstra Corporation I 33/242 Exhibition St, Melbourne 3000 I 0418 391646 I t 03 9634 3351 I f 03 9634 3413

Telstra and the Environment - Have Your Say