Should Telstra be sold?

[Rodion]

I said this on another thread, but I think it deserves repeating. If Telstra goes private, they'll forget all about the regional people and let the standard of service slip. Eventually some country person will be trying to ring an ambulance or Flying Doctor and not be able to get through like what happened a few years ago. Trouble all round. I say that the ability to call the ambulance in a critical situation must not be trusted to a big private company.

 

[Hawk_2004]

The government. To be paid for by the fees telecomunication companies will have to pay in order to use them.

So basically hire Telstra's infrastructure staff?

 

[OldMan]

Yes it should be sold, there is no reason for the government to be in the telecommunications business. Government should only be involved where there is market failure or in the provision of "public goods" (eg police, military, etc). Should the government also run food distribution and take over Coles and Woolsworths?

 

[evo]

Good post oldman.I concur.

Incidently,any Australian who contributes to a superanuation fund is already a shareholder of the partly privatised Telstra.

Ya pack of Capitalists.

 

[JeffDunne]

Yes it should be sold, there is no reason for the government to be in the telecommunications business. Government should only be involved where there is market failure or in the provision of "public goods" (eg police, military, etc). Should the government also run food distribution and take over Coles and Woolsworths?

I'm sure Halliburton would be more than pleased to privatise police forces around the globe.

What makes me laugh about this "government shouldn't be in the . . .. business" line, especially with telecommunications, is that the some of the most successful companies in the world are still owned by governments (some have the foresight not to divert working class incomes into the coffers of investment bankers but rather chose to use these funds to invest in the countries infrastructure)..

Take a look at the company who now owns Optus. They stand to gain more than any other from a loss of market share to Telstra. And who ultimately benefits from the success of SingTel? Singaporeans through their 'superannuation' investments. Seems like an idea to me.

For those that support privatisation as some sort of mantra, could you please highlight a couple of example where privatisation has returned benefits to all the stakeholders? I'm having difficulty finding them.

 

[JeffDunne]

Good post oldman.I concur.

Incidently,any Australian who contributes to a superanuation fund is already a shareholder of the partly privatised Telstra.

Ya pack of Capitalists.

Yeah good idea . . . force us to pay into a fund to buy something we already own.

 

[Mr Q]

Yes it should be sold, there is no reason for the government to be in the telecommunications business. Government should only be involved where there is market failure or in the provision of "public goods" (eg police, military, etc). Should the government also run food distribution and take over Coles and Woolsworths?

Your analogy is not quite right - the distribution of calls will be the responsibility of the privatised company. However the actual infrastructure the calls are delivered on is public.

Your analogy would be better served if the roads that Coles and Woolworths trucks used themselves were private. Which they're quite clearly not.

 

[OldMan]

Take a look at the company who now owns Optus. They stand to gain more than any other from a loss of market share to Telstra. And who ultimately benefits from the success of SingTel? Singaporeans through their 'superannuation' investments. Seems like an idea to me.

Actually Singtel grossly overpaid for Optus. That the company is successful is almost irrelevant, you have to compare the discounted future earnings to the price paid. The point you seem to be missing is that an income stream from any company, including Telstra, has a present value. If someone wants to pay above this value, the government would be better off financially selling no matter how successful the company is.

 

[funkyfreo]

Just so long as they don't upgrade the bush services before the sale.

 

[Frodo]

Telstra are a joke. Their efficiency is appalling. They need privatising so that we get a new culture, better management and better service.

And also because my shares will rocket in price

 

[JeffDunne]

Actually Singtel grossly overpaid for Optus. That the company is successful is almost irrelevant, you have to compare the discounted future earnings to the price paid. The point you seem to be missing is that an income stream from any company, including Telstra, has a present value. If someone wants to pay above this value, the government would be better off financially selling no matter how successful the company is.

Depends on how you determine present value. The value of a countries telecommunications infrustructure cannot be measured in just the revenues derived from current charges. It now effects the earning capacity of all other industries. Now if the government were just a shareholder in Telstra this wouldn't be a concern, but they are responsible for the interests of all Australian industry - not just what's best for Telstra shareholders.

Whether Singtel overpaid or not is irrelevant.

Telstra missed the significance of the internet (and other technologies). What makes you think they now have a good handle of the telecomuunications market in 10 years time (let alone now)? I wouldn't trust the government or Telstra to make ancurate assesment on it's worth. But if you sell it now, it will be the market that determines it's value. The very same market that had valued dot coms as a buy @ $250, then in a matter of months to be quoting less than a buck as a sell.

The point you seem to be missing is that Singtel are one of the best performed telecommunications companies while remaining governement owned. They aren't even 100% government owned. They make a mockery of Howard's 'half-pregnant' analogy.