Spooked Optus takes its eyes off the ballCOMMENTMichael...

Spooked Optus takes its eyes off the ball
COMMENT
Michael Sainsbury
September 07, 2006

SOL Trujillo and his lippy sidekick Phil Burgess may not have had any success shaking the resolve of Communications Minister and competition tsar Graeme Samuel, but they seem to have well and truly spooked most of their telco competition.

Last month, on a damp Melbourne day, Optus chief executive Paul O'Sullivan gave an extraordinary speech to a packed ballroom at the city's swank Crown Casino.
Only hours earlier, down the road, Telstra had launched a $50 million network integration centre: its clear message was all about innovation.

The contrast could not have been starker.

He then spent the next half hour or so biitching about Telstra. Whether his points were valid or not, he misjudged his audience and lost a golden opportunity.
O'Sullivan also had the hide to have a go at Telstra "running the old national champion argument", where governments back a local company to succeed.

Optus is controlled by the Singapore Government, which also owns the island state's biggest competitor, its airline and many other big enterprises. Nothing wrong with that, but hypocrisy is ugly.

Indeed, such is the nation and the Lee family's (Lee Hsien Yang runs SingTel, his brother is PM) control over industry, that Singapore might have re-invented national champions.

I suspect O'Sullivan really lost his audience when he self-seekingly demanded that the Government force Telstra to deal with the so-called G9, a group of Telstra's competitors, most of them flatlining or going backwards, who want Telstra to help them build a fibre network.

Perhaps in Singapore, Paul, but not here.

Whatever you think about Trujillo's style and methods, his basic strategic direction is sound (after all, it's hardly rocket science) and he has re-invigorated Telstra.

The company is more aggressive, spending up to buy market share. Its marketing is sharper than it has been for some years and, especially in the consumer market, has competitors scrambling.

Optus has effectively had a massive win with no changes to regulations. But still it resorts to whingeing and it is legally challenging regulations on usurious mobile wholesale charges.

Even more worrying, its best staff are heading out the door, with well-regarded consumer strategy chief Chris Lane just the latest to soon depart for greener pastures.