Stuart Corner
Tuesday, 03 October 2006 07:09
Opinion and Analysis
Page 1 of 3
Gee this guy Sol Trujillo is brilliant. In just over year he has transformed Telstra from being a lumbering and bureaucratic government department into a nimble global corporation and he's identified and remedied a lack of products for the small business market that seems to have eluded all his predecessors: this at least is what you might believe if you took some of today's newspaper reports at face value.
The $8 billion potential Telstra share sale concentrates the mind wonderfully and finance minister Nick Minchin seems to be pulling out all stops in support of Telstra's CEO, in contrast to prime minister John Howard who seems to be doing the exact opposite.
Minchin told ABC Radio yesterday that Trujillo had brought "a new dynamism to the company." That certainly is true (but not necessarily re-assuring). He then went on to say. "He is turning what is an old government department, the PMG, into a fully-fledged, highly competitive, globally oriented, commercial telecommunications company."
Please. Telstra has not been part of the Postmaster General's Department since 1975 when the Australian Telecommunications Commission (Telecom Australia) was created and in 1988 it became a corporate entity, The Australian Telecommunications Corporation, subject to corporations Law, but with all its shares held by the Government.
Since 1991 it has been subject to competition in all facets of its operations and for seven years was run by another American CEO, Frank Blount, determined at one point to generate 20 percent of the company's revenues offshore by 2000. Then along came Ziggy Switkowski and Ted Pretty who rode the dotcom wave into overseas markets blowing billions of dollars of shareholders' money in the process. Trujillo has certainly taken on a challenge, but not the one that Minchin so glibly trotted out.
