.. Are the questions I want to ask Telstra’s Now We Are Talking.
They will seemingly be happily racist about Singapore, despite the fact that Optus is an Australian company, employing Australian people, and is owned, not as they want people to believe, by the Singapore Government, but as fact shows, a Holdings company in Singapore.
The FTTN debate or struggle, is now getting more competition around the tender process, with the G9 consortium and Telstra, now having to welcome Deutsche Telekom to the bidding board.
This does a few things.
It’s almost certain Telstra won’t be building FTTN, they are too expensive, and with two other proposals that should state exactly that, we’ll see either a G9 proposal, or a Deutsche Telekom proposal on the drawing boards for approval.
However, consider this, Telstra have been very vocal about Optus being involved in a consortium of 9 Australian companies, stating that giving dollars to the Singapore Government is a bad thing.
With this in mind, what happens when the dollars aren’t going to a Singapore based Holdings company, but instead, to a German Telecom company?
Is that as bad? Or is that good? Or do we simple shut our big racist traps on the issue? Nice hot topic to ask those American Telstra Racists!
With FTTN competition heating up, things are looking good all around for Australian consumers. Telstra is about to shave a heap of revenue off, and that will equate to lower profits, and that’ll equate to a company transformation, with Telstra likely wanting to get in on the action.
Deutsche Telekom have also been in contact with G9 members, and apparently would like them to manage the network should they be successful in their tender for an FTTN network!
With all this in mind, as well as the Australia Connected announcement, Telstra is being put in a very strategic position, more of a government based Strategic Positioning outcome.
With Telstra stuck in a corner, unable to compete with newer technologies due to regulation, the positioning would soon realise something, very, very important.
Telstra has the last mile, and will continue to whinge and whine about how it can’t compete due to regulations.
They’ll keep that up all they can. However, what will the end result be?
When shareholders start losing value, they’ll want more of the moolah, so Telstra will have to reposition itself.
In order to compete, and for it to be able to compete effectively, without the issues it currently has with regulation, it needs to remove regulations.
The government have stated that regulations are here to stay where a monopoly exists (and will exist while Telstra owns the last mile copper).
The solution, which has been staring them straight in the face, and even echoed through New Zealand, and recently, in the UK, BT’s CEO claims the success was cooperating with regulators, and the government to split BT up.
A common misconception about demergers are that they will destroy shareholder value, due to the loss of the big asset, but in reality, they actually cause financial markets to improve, why?
Easy, Telstra have said this for months now, Regulations are stopping them investing. They also recognise that Regulations exist to promote competition.
The missing link in all that was: Competition needs Regulation. Regulation promotes Competition. Therefore, for the ACCC to do their job of protecting consumers and competition, they must ensure regulations remain.
The solution to the problem?
Easy. Telstra prices its infrastructure services at a reasonable level, and regulations start to back off (not likely).
Telstra does as BT CEO said recently, “Divide and Conquer”. That is, lose the reason for regulations, invest, and see some shareholder value released.
At this very minute (and every minute Now We Are Talking remains online) Telstra are very quickly destroying shareholder value, so much so to the point where shareholders will need to speak up, or Sol will do what happened at US West and accounting records will somehow get falsified, or, he’ll open his dang eyes and see that he is running the company into the ground, and therefore needs to divide and conquer.
Relax, a second company can have regulations, and they can be a competitor.
They can finally see what its like to be forced to start paying bills at ridiculous prices, but more likely, the opposite will happen, prices will come down across the industry, because the network infrastructure body will want to make a return, as well, will want to do its own infrastructure rollouts so it doesn’t go broke when the copper network degrades away at a rate beyond repair.
Back to point 1, when Deutsche Telekom submit, are we going to see racism out of Telstra? Or a reason why Germany is better than Singapore? I’m keen to see this. Very entertaining! I’m sure the shareholders will ask the same thing, why is Germany better? Or are we racist to everyone?
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