It’s all about the Telstra mess in the business pages today
– the Financial Review leading with
the news that Queensland
senator Barnaby Joyce last night was having “second thoughts” about the T3
sale, while the federal government was facing pressure to strengthen its
proposed regulatory regime. Having had nearly a decade to mastermind the sale of
the telco giant, the arrangement the government has come up with looks
“hasty and lopsided,” says the Fin‘s
editorial (not online). And on the central issue of how to separate
Telstra’s operations – which was meant to pave the way for a
transparent and fair market –
they’ve “unbelievably, left it up to Telstra.”

Telstra will accept operational separation and the corporate
watchdog will decree lower prices for competitors to use its copper network, the “final mile” to customers’ homes and
offices, says Garry Barker in The Age. That’s Telstra’s immediate future, so far as the ACCC is concerned. Which isn’t ideal for Telstra, says Stephen Bartholomeusz in the Smage, but is far better than
the alternatives. With prices yet to be negotiated,
there is still scope to finesse the effect of the new regime.

As for the awkward matter of that price-sensitive
information being provided
to the Government before the ASX, Telstra is blaming the Howard Government for failing to keep
its lips zipped, says Bryan Frith in The Australian. While the prime minister – fending off accusations of preferential treatment and misleading the market –
says he was under a legal obligation to keep it confidential,
says Elizabeth Knight
in the SMH. The problem is that
Telstra’s August document outlined a company in worse shape than
the rest
of the market was aware of. And Howard didn’t help his argument by
saying Telstra
management should be talking the stock up, rather
than down. They should be doing neither, says Knight – just telling
the truth.

In other news, the Fin reports (not online) that packaging
billionaire Dick Pratt has formulated a succession plan to divvy up parts of the Visy empire to his three adult children.
The story also points to an interview with Pratt in today’s BOSS magazine. In the SMH,Michael Evans notes that Rupert Murdoch has been nudged from his number two spot on Vanity Fair‘s list of who’s big in the Establishment by those
two uppity zillionaires from Google, Sergey Brin and Larry Page.