Ziggy
Switkowski’s Q&A performance at the National Press Club yesterday was the
best bit of PR Telstra’s had since, well, since Donald McGauchie became
chairman.

Particularly
telling was the direct challenge he put out to his critics and the various political
opportunists over the much-hyped capital spending and financial performance
issues.

It’s a
challenge that will hang over the head of Sol Trujillo – a challenge I somehow suspect might go
unanswered.

Having interviewed
the Ziggster pretty regularly ever since his Optus days as well as observing
him in numerous media conferences, I’d rate yesterday’s Q&A as perhaps his
best effort. While carefully not criticising the new regime, he quite nicely
skewered the cowboys’ clumsy bluff and bluster tactics.

The core to
that was his benchmark challenge – something I haven’t been able to find in the
three papers I’ve skimmed today.

Questioned over
the allegation that Telstra skimped on capital expenditure on his watch, putting
the future of the company in peril, Switkowski observed the capital investment
spend had been something like $24 billion over the five years.

Benchmark
Telstra’s capital investment spending and its financial performance under his
reign, dared Ziggy, benchmark it against other telcos around the world and
against what Telstra does over the next few years, and he would be pretty confident about the
outcome.

There’s mobs of
highly-paid telecommunications analysts lying around investment banks
who should
be capable of carrying out the first part of that challenge – if it
might be in
their employer’s best interests to do so. But getting off-side with
Trujillo and his three amigos is not in any investment bank’s
best interests at present.

My guess is that
Switkowski wouldn’t have made that challenge without already knowing the answer
to the first part and having a much better feel than most about the likely future.
Particularly given Telstra’s flirtation with GE-style Six Sigma methods, his
management team would have been benchmarking everything in sight – especially
an item as big as cap ex.
If my
suspicions are correct, Trujillo’s attempts to blacken his predecessor’s performance
will look pretty tawdry indeed. Oh, there’s plenty of argument around the edges
about mightabeens and couldabeens, plus a few genuine mistakes, as Switkowski
willingly conceded yesterday, but the core’s not rotten.

For Telstra
investors, the Ziggy challenge means their company isn’t the basket case Sol’s
been trying to make it out to be for his own purposes. That should be much more reassuring that any
valuations stuck on it by brokers and investment banks with other agendas.