As unlikely as it might seem, there is a lot that’s good and promising about Telstra, as well as a lot that is not good and not promising. Leaving aside the question of the CEO’s credibility and whether Phil Burgess or Nick Minchin makes a better filial financial advisor, punters have to decide at what price the good might outweigh the bad.

The Sun-Herald’s David Potts tried to weigh it up a week ago, albeit in the context of whether Sol was good for Telstra – and the jury is still out on that one. Potts’s list of good and bad arguments consisted of:

ADVANTAGES
 – Becoming more competitive
 – Good assets
 – Strong cashflow
 – In the box seat for broadband boom
 – Fully franked dividend

DISADVANTAGES
 – Regulatory risk
 – Question over future dividends
 – Setting low price on copper wire access
 – Earnings under pressure
 – T3 unlikely

He’s already been proven wrong on the last point, but you could probably leave T3 on the disadvantages list anyway given the failures of principle it’s induced by the board.

I’d clarify and extend the advantages by saying:

1. The broadband business is working, is growing nicely, increasing market share and is very profitable. For all the whinging from the nerds and the greek chorus about the broadband offer not being an eight-lane autobahn, the punters still like it and don’t know what they don’t know.

2. There’s promise in the 3G mobile phone roll-out, maybe enough to halt the inevitable attack on the massive mobile phone profit margins. Telstra’s main competition is hurting more than it is in the wake of the mobile caps campaigns, making me suspect the industry will settle down sooner rather than later to the sort of “rational” competition that characterises our airlines, banks etc.

3. Sensis has the potential to be something.

4. Foxtel has the potential to be something too, if 50% owner Telstra can find a way to stop being ripped off by its PBL and News Corp partners.

5. An equitable deal is reached with the ACCC on the network.

6. Technology. The potential of new technology to make greater use of existing Telstra assets.

And then there’s the disadvantages:

1. The copper wire business local phone erosion is made worse by the culturally-insensitive Telstra management being unable to reach a reasonable deal with the ACCC it keeps rubbing the wrong way.

2. It only takes one suicidal player to keep eroding the fat mobile phone margins game.

3. Sensis has a great deal of potential to be mediocre, not delivering the promised growth. The Trading Post story doesn’t sound good.

4. Political interference down the track, risking further impositions under the guise of the universal service requirement. With the ownership question removed, Telstra-bashing can grow apace.

5. Technology. The potential of new technology to leap-frog existing Telstra assets.

It’s your choice.

Disclosure: The Pascoe family super fund unfortunately includes a few Telstra shares.