While some of its competitors are crying foul over the seemingly light sentence meted out to Telstra by the ACCC for its $29.95 broadband hanky panky, the outcome was probably a fair and reasonable one for most parties.

If it had wanted to bring the full force of its punitive powers to bear, the ACCC could have fined Telstra tens of millions for all the days that it was in breach of its competition notice. However, by moving relatively quickly to lower the wholesale cost of ADSL broadband access to its retail competitors and, now, agreeing to pay $6.5 million in rebates to those competitors, Telstra has shown at last that it is prepared to take the competition regulator seriously.

In addition, Telstra will have to give the ACCC 15 days notice before making any future competition killing broadband pricing deals available to consumers. With fairly powerful competitors in the wings ready to raise howls of protest the minute they catch of whiff of what they consider to be dubious pricing practices, Telstra would appear to be effectively corralled - at least in the area of broadband services provision.

Those competitors arguing for a much steeper sentence for the big carrier may be justified in doing so. However, a stiffer penalty would probably have no measurable effect on a company the size of Telstra and, in the end, would probably only amount to a slightly decreased dividend for shareholders, many of whom are of the mum and dad variety. Rather, Telstra’s competitors should take heart from the fact that the ACCC did in the end force the big carrier to adhere to its regulatory guidelines.

As for the worry expressed by some competitors about Telstra’s behaviour once it becomes fully privatised, is there any reason to think a fully privatised Telstra would be any more anti-competitive than a majority Government-owned Telstra? Based on past experiences of the Government-owned entity, we don’t think so!

The lack of a majority Government interest behind it may well be just the force that is needed to bring Telstra to account. If the Government is no longer a financially interested party, then Telstra becomes just another large Australian company like BHP or NAB, subject to the same rules, regulations and market forces. Without Government backing, it will be hard for a privatised Telstra to maintain the sham that its fixed line wholesale and retail businesses operate independently of each other. Perhaps only then will we see a fair a just solution for a truly competitive telecommunications environment come to fruition – the spin-off of Telstra’s wholesale division.

Finally, let us issue a word of warning to those who take delight in Telstra bashing. We wish to remind you that aside from the Government, who is soon to depart the scene, the majority owners of Telstra are the Australian people. Aside from the smaller local players, the big carrier’s main competitors Optus, Hutchison, Primus, Orange and the like are offshore trans-nationals. A sobering thought indeed for Australians wishing to see Telstra cut down to size.