If you know somebody who has moved from the UK to Australia in recent years, ask them what they are paying for their phone, internet and pay TV. They will probably tell you that they are now paying 50 per cent more than they were back in the UK. The reason is not simply the UK's larger market and geographical concentration. It's the forced separation of the retail and wholesale activities of the former British Telecom, which took place some time ago.
Following Australian Communications Minister Stephen Conroy's announcement of government moves to engineer the structural separation of Telstra, the Australian consumer has reasonable grounds for hope that telecommunications pricing will be fairer.
On the face of it, this is obviously good news for the consumer and bad news for Telstra and its shareholders. Opposition communications spokesperson Nick Minchin immediately leapt to the defence of Telstra's so-called 'mum and dad shareholders', insisting that they will have a case for seeking compensation for the '$2 billion wiped off the value of mum and dad shares in Telstra'.
This is understandable, as wealth is being transferred from one sector of the population to another as the result of a government change of policy. However questions need to be asked whether the widely-recognised price-gouging practices of Telstra make this wealth ill-gotten, and if the practices might be legally but not morally defensible.
There are many aspects of these questions we could take up. One is the use of the emotive term 'mum and dad shareholders'. Former Telstra chief Sol Trujillo would use it to justify predatory-pricing practices that sought to drive his Singapore-owned Optus rival out of business. He said:
We have 1.6 million mums and dads that own shares in Telstra and they do care about their investment and they want to be treated fairly and they don't want to see a government official, or regulator or whoever saying 'Let's take Telstra's value that they create and send it to Singapore'.
Aside from the fact that the significant transfer of Telstra's 'value' will be from 'mum and dad shareholders' to mum and dad 'customers' (rather than 'Singapore'), price-gouging has to be seen to be immoral. Trujillo and Minchin are using the the mums and dads moniker to sanitise the practice.
This must be seen as a sin akin to usury, which is now understood to refer to excessive interest. The online Catholic Encyclopaedia says 'lending