Sol Trujillo rides off into the Mexican sunset taking with him a suspected $20 million dollar bon voyage payout, while incoming CEO, David Thodey, is left to pick up the pieces and rekindle the severed relationship left behind between Telstra and the Australian Federal Government. The appointment of Thodey has also seen the resignation of Donald McGauchie, which is effective immediately, along with the appointment of Catherine Livingstone who will take on the company’s chair.

David Thodey was a likely internal candidate to succeed Trujillo. For one, he is an Australian who knows the Australian environment, and possibly a key that won Mr Thodey the board’s vote over three other rivals, including a British executive, was his close relationship with many key Government officials. To the contrary of Mr Trujillo, David Thodey has a calm nature and was not closely associated with Mr Trujillo, so this should also give him a great advantage in the political arena.

Trujillo was essentially hated by the Australian Federal Government. He only had himself to blame for being dropped from the Christmas Card mailing list as his hostile approach to the Australian Telecommunication environment and Federal Government made Trujillo highly unpopular. What’s more, in his time at Telstra since 2005, Good ol Sol personally axed 10,000 Telstra Jobs and was not liked by the ACCC, unions, customers or his own employees. His tenure at Telstra also witnessed the nose dive of Telstra shares by more than 25%, so I guess its safe to say that many Australian Mum’s and Dad’s are also on the list.

David Thodey has definitely got a huge work load ahead of him if he’s going too turn the tide. On his list of priorities will be the new National Broadband Network and the looming Structural Separation of Telstra whilst fending off concerns raised by investors. He certainly appears to have the port folio to pull it off and we wish him well.

David Thodey Background Summary
Kellogg Post-Graduate School General Management Program at Northwestern University in Chicago
Bachelor of Arts in Anthropology and English from Victoria University in New Zealand
Pre 2001 – Chief Executive Officer IBM Australia / New Zealand (22 year career)
2001 – Group Managing Director of Telstra Mobile of Telstra Corp
2003 – Group Managing Director of Telstra Business and Government of Telstra Corp

If the writing wasn’t already on the wall, the imminent fate of Telstra chief ‘Sol Trujillo’ was definitely made more evident after blundering the NBN bid. It’s been officially revealed that the Telstra CEO will in fact step down on June 30th this year after 4 years with the incumbent.

During his period at Australia’s largest telecommunication provider, Mr Trujillo says the results he’s achieved in this respective time has made him incredibly proud. He certainly has Telstra’s world leading Next G Mobile broadband network to his credit, however others would argue his success was limited, especially Telstra’s shareholders.

There’s no doubting that Mr Trujillo’s almost ruthless approach at dealing with the Industry’s challenges; it’s competitors; Australian Government relations; and regulatory conflicts earned him some stripes if not stars, however history will possibly reveal down the track that the one thing that he didn’t know too well was the environment he worked in and it’s people.

So who’s next in the seat? If the board share similar opinions to those just described, I’d be inclined to lean toward an in-house appointment. Telstra may be twice shy when it comes to obtaining a foreigner for the top roll, and someone that will be subject to an unfamiliar, and at times, hostile environment. My guess Telstra’s next boss is an Aussie!

Telstra will not build the $4.7 billion National Broadband Network! The Government’s expert panel has made extraordinary headlines by making a decision to reject their non-compliant bid based on a technicality. Telstra was dumped from the process on grounds that it did not meet a section of requirements surrounding a ‘small to medium enterprise plan’ which was a mandatory part of the NBN criteria.

In the biggest Broadband news to hit the industry this year, Telstra boss ‘ Sol Trujillo’ may have called his last bluff by submitting a pitiful 12 page NBN proposal to the Australian government. Trujillo was believed to be somewhat bewildered by the decision as he had not yet had any correspondence with Minister Conroy, thus receiving the news secondhand.

“We are a bit surprised at taking this action on a triviality, which we are very clear in our minds, we were fully compliant in the language of the RFP in terms of how we handled this matter. I don’t want to speculate beyond that, because we’ve not had any conversation with the Minister or the appropriate people involved yet,” – Sol Trujillo

Many Australians have been made buoyant by the sobering decision to dump Telstra from the NBN process as they believed the incumbent was too powerful in holding out competition; slowed down innovation and market growth; and charged extremely high prices for telecommunication services.

On the surface, this latest decision by the government is statement of strength and unity which suggests they will not be taken lightly with the national broadband network process, and furthermore, will endeavour to create an ‘open access’ network with ‘fair’ regulatory conditions for Australian consumers along with an equal playing field for Industry competition.

At the same time this decision will also force Telstra to re-evaluate their strategy on the NBN. This may included succumbing to the NBN process guidelines and submitting an eligible comprehensive proposal, if the door is still open that is? Or possibly considering business (on their own) beyond the NBN.

If this latest slap in the face doesn’t awake the arrogant giant, it’s quite likely that Telstra’s shareholders will, or the perhaps the possibility of declining stock value? You’re move Telstra, the ball is well and truly in your court now.