Telstra’s first half profit is down so the share price is up – the result
of Solly Trujillo’s team making sure the market thought things would be a bit
worse than they are. Telstra shares were up 9 cents to $4.12 at midday.

The market was fearing a fall of 11% or worse, so a dip closer to 10 than 11 is enough for a relief rally,
along with some soothing words about the cowboys’ plans being on track, or at
least that nothing is worse than previously announced.

Some $2.14 billion is still a lot of net
profit for six months work, never mind all the dire warnings from the Top
Tortilla. Today he was a little more reassuring.

“The recent deterioration in operating trends and
our investment in transforming the business will see earnings fall in the near
term,” Telstra chief executive Sol Trujillo said.

“Consistent with our plan, we are taking some tough
medicine now to bring the company to financial health and deliver sustainable
growth in shareholder value over time.”

Telstra is losing land line customers
faster than anyone has suggested, but the growth in its other businesses still
managed to lift total revenue for the half from $11.36 billion to $11.58
billion.

But if all the local telcos want is something
else to worry about – and if the ACCC wants something else to examine – they
could check the European Union’s move to crack down on the outrageous
international roaming charges they use to slug customers.

The BBC
reports a law is expected by 2007 to deal with the mobile phone companies’ “fantasy costs” for international roaming.