By Glenn Dyer



A two-day Telstra board meeting starts in
Sydney today to discuss strategies for 2005-2006, the earnings outlook
for the year to June, and the big question: who will be the new CEO
when Ziggy hangs up his suit? It was at the same meeting a year ago
that Telstra’s board finally accepted that the Telco was more like a
utility, and not a growth stock, and decided on a capital return
program to shareholders of $4.5 billion over three years.

One
third of that amount has already been handed back to shareholders,
including the Howard Government, in addition to the existing dividend
stream. Some market reports say an American is down to replace Ziggy
Switkowski when he departs at the end of June, while others insist that
insiders John Stanhope, the finance man, and David Moffatt, the former
CFO and now head of retail and consumer, are still contenders.

Telstra
shares have dipped in recent weeks to well under $5 as some broking and
investment banks, who will not be on the final managers list, paint a
gloomy picture for the company over the next year. The float of T3
looks like being in the 2006-2007 financial year, so that will give the
new CEO and board, led by Donald McGauchie, time to pretty up the books
and to charm investors.

Investors should be watching any
chimneys around Telstra’s Sydney head office for signs of white smoke
emerging over the next couple of days.