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It seems very odd to me.. in fact it seems damn right outrageous that in my Telstra bill they see fit to send me propaganda. Propaganda my bills are paying for.

What am I on about? Telstra is a business like any other right? Entitled to advertise right? Well yes and no…

Telstra, like BT, and a number of other previously tax payer funded national telecommunications companies, have the unenviable position of being (now) publicly (listed) companies. In Telstras case its kind of walking around with a chain and ball attached to one leg… Telstra is trying to be a profit making centre for its share-holders whilst still having the responsibility of maintaining government imposed universal service obligations (USO).

The Universal Service Obligation

Don’t get me wrong, the USO is the ‘right’ thing – in a country as geographically large as Australia it is fair that the cost of universal telecommunications access is shared by the whole population rather than imposing a purely capitalist user pays regime (under which somebody living in outback whosawhatsit town would pay about 20 grand to have a satellite link just to have a telephone).

The problem is when the government flogged Telstra off they effectively gave the countrys telecommunication infrastructure (paid for by generations of tax paying Australians) to a private company. To balance this they had to impose upon the new inheritor of this infrastructure the obligation of continuing universal service (pay phones, equal cost for a phone connection in whoopteedoo, outback South Australia, as in Sydney etc etc). Now this is obviously a nonsense – in that a private company has no interest in public service – its function is profit.

I can probably live with the ‘nonsense’ that a private company has a virtual monopoly over infrastructure (as we go through a long-term changeover – 20 years+? – to a properly de-regulated telecommunications market) as long as we all realise that this private company has no real interest in the USOs beyond providing what they have to and being paid to do so (to the tune of around $280 million in 2000-01).

Telstra is not the old PMG, Telecom or a government entity of any type..

What I can’t stomach is that Telstra seems to be abusing their past position as a government provider by marketing at the Australian people like they are still a public service – they ARE NOT – they are a private, publicly listed, for-profit, company – ala:

• of around 45,000 employees (a little comparison – the Australian Defence Forces have a total of about 50,000 personnel apparently)
• earning over 3 billion A$ after tax profit (Annual Report 2006 [pdf]), and
• paying over 14c per share dividend to investors (Annual Report 2006 [pdf])

There is nothing wrong with them being a private company (if one ignores past arguments about who should own national infrastructure – thats a done deal now – its sold) and working for the profit of their shareholders – that is capitalism.

There is, however, something wrong with them marketing themselves like they are still a public service, or as an entity which intrinsically cares about the people of Australia and their future in terms of telecommunications infrastructure. This appears to me to be verging on dishonest. Lets keep this straight – Telstras interest is profit and any attempts to improve infrastructure will be about their market share and profits for the companys future – not ours.

Wrap up

It is true that somebody has to invest in telecommunications infrastructure in Australia so that we can improve our telecommunication services and compete on the world stage over time. We as customers will pay for that infrastructure no matter who builds/services it and we are well beyond the days where the government provides any telecommunications infrastructure.

If we accept that this is to happen in a de-regulated market (and didn’t we by voting in a government which said they were going to sell Telstra?) then lets do it in a properly de-regulated market – spread the USO around – and ignore Telstra’s obviously mis-leading propaganda…

Full disclosure: I am not a Telstra customer for fixed telephone or internet services due to the issues above and the savings I can make elsewhere. So yes, I am grinding my personal Telstra axe..

References:

• Telstras propaganda site
• The G9‘s counter-propaganda propaganda site