Telstra still only cheers for Telstra

The men running Telstra have been accused of a lot of things, but lack of conviction is definitely not one of them. I found this out recently after having the chance to hear Phil Burgess, the company's most senior regular spokesperson and an outspoken critic of the government's telecommunications policy, address an AIIA-sponsored business lunch in Melbourne.

Over the course of an hour-and-a-bit presentation (listen to it here), Burgess laid out his case -- as I'm sure he has done a hundred times already -- as to why Telstra is being wronged by the government.

He took numerous opportunities to throw jabs at ACCC head Graeme Samuel, and took the time to explain that the company's active and antagonistic education campaign was following international conventions to raise awareness and stir up dissent amongst the populace -- hoping to foment a sort of broadband-fuelled Bastille Day, I suppose.

In the process, however, Burgess -- who was affectionately described as "Dr Phil" in the AIIA event literature -- also revealed the absolutely intractable mentality of the heads of Australia's largest telco. Contradictions and hypocrisy were flying thick and fast as Burgess clarified one very simple thing: we can all expect very little relief from Telstra in solving the much-discussed broadband drought.

With the type of baby-kissing, emotive rhetoric you'd expect from politicians during an election year, he relayed the story of a remote school that he and Sol Trujillo had visited in 2005, early in their tenure at the company. Moving to demonstrate their School of the Air learning portal, Burgess said, the children clicked to download the module, then walked away to do chores because they knew it would take several minutes to download.

Trujillo was moved to deep introspection, Dr Phil told us, because he couldn't believe the children were suffering the ignominy of having to learn at such a slow pace.

"We should all be ashamed about what we saw," Burgess quoted Trujillo as saying. "Telstra should be ashamed, the government should be ashamed, and regulators should be ashamed, that we have kids in a developed country like Australia, in the 21st century, downloading at kilobits and not megabits."

This sentiment echoes a comment Trujillo made in his maiden speech in Lismore, earlier on in the same road trip. "We decided Sol's first public address would be in Lismore, to send a message that we cared about the entire country," Burgess said. "In that speech, which was very well received, he said we have three priorities: Australia, Australia, and Australia."

Two years on, I suspect the kids in that school are still washing their hands while waiting for their lessons to download. Telstra has not, I gather, gone back and enabled that school to get a faster broadband connection, or Burgess would have told us so. And while the management team can point fingers and argue that others are holding back the children of this country, Burgess later admitted that it is actually Telstra holding the country to ransom.

How so, you ask? Later in the presentation, he showed what have apparently become popular slides documenting the actual footprint of ADSL2+ across several major cities.

Telstra, you see, has already installed ADSL2+ equipment in dozens of exchanges but refuses to turn them on until other companies put their own gear in the same exchanges -- or until it gets a promise from the government that it can keep competitors from accessing the equipment. (Page through this document to see the before-and-after coverage maps.)

"All we've got to do is flick a switch, and we can turn these all on in 24 hours," he said. That may make sense to him, but it's small consolation for the many people who are absolutely fed up with waiting for Telstra to give Australia the bandwidth it needs.

The problem is that a closed, single-provider situation is inherently anti-competitive, which means the government, which has spent considerable time and energy putting teeth behind the very purpose of the ACCC, simply cannot allow this.

Ironically, the ACCC's sole purpose is to protect the interests of the same citizens Telstra is refusing to service.

The result is very clear: ADSL2+ will only be rolled out at the pace that Telstra's competitors move. But Telstra's competitors will be hard-pressed to justify funding DSLAMs in areas where they know Telstra, with its history of cross-subsidies and below-cost market share grabbing, is waiting to pounce.

This is a game of full-contact chicken predicated on the fact that Telstra, as a near monopoly telco, has the luxury of time on its side.

The company has, Burgess said while wrapping up his speech, drawn a line in the sand. And while it defends that line to the death, so it seems, the pace of innovation in Australian telecommunications will be driven not by the innovation of its largest player, but by the scantly funded piecemeal efforts of its much smaller competitors.

This is the true state of broadband in Australia, and it's the reason why so many people still simply cannot access decent data services.

Burgess can slam the speeds at the school they visited two years ago, but by refusing to improve the situation, he's confirming that Telstra prefers to remain part of the problem.

Which takes me back to Trujillo's comments in his maiden speech.

If his priority truly is Australia, Australia, Australia, what in the world is going on here? I can't help but think of the analogy of a doctor withholding treatment for a chronic condition until the patient has paid up, or teachers refusing to teach their students until they get better staff parking.

If Telstra is really concerned about Australia, it should do something to help Australia's future, rather than fighting the regulator that has been put in place to protect every Australian.

Or, perhaps, a more honest move would simply be to say that Telstra's management team has three priorities: Telstra, Telstra, and Telstra.