Chapter 2 Casualties of Telstra
In July 1992 Karen rang to tell me she had heard of a restaurant in Melbourne suffering the same phone problems that were crippling me.
I felt a great comfort in hearing this, and knew I needed to meet the owner. Making phone contact with the restaurant was of course difficult, but eventually I got through to Sheila Hawkins, proprietor of The Society restaurant in Bourke Street, in the centre of the city. We arranged to meet and I travelled to Melbourne in early August.
It was so good to talk to someone who experienced similar problems. And there were more of us. Sheila knew of an Ann Garms who ran the Tivoli Theatre Restaurant in Brisbane, who was also having serious telephone problems. Back in Cape Bridgewater I rang Ann to discover she was coming to Melbourne the following week to register her own complaints with Austel, the Australian Telecommunications Regulator, and we arranged to meet together with Sheila. I went into the city again for the meeting, where Ann mentioned another Brisbane business that was in similar trouble — a car parts company run by Maureen Gillen. Like Ann’s business, Maureen’s was trunked off the Fortitude Valley exchange. Sheila, meanwhile, had contacted Graham Schorer who somehow ran the Golden Courier Service out of North Melbourne — despite a very bad phone service.
Finally our little group gathered together at Sheila’s restaurant in Bourke Street, except for Maureen who couldn’t make the journey from Brisbane. It was Sheila who suggested we call ourselves COT — Casualties of Telstra. This was one of her last actions with the group as she withdrew shortly after due to ill-health.
At the top of the list of problems we held in common were those three little words: ‘No fault found.’ It wasn’t just that we all had to put up with ongoing service faults, Telstra’s evasion of responsibility in this regard made those faults a nightmare. Telstra had a duty to deliver us service up to a recognised network standard, and by failing to ‘find’ their faults they were effectively avoiding carrying out their statutory obligation.
In October 1992 COT had its first official meeting with Telstra, at the Ibis Hotel in Melbourne. We were a united and optimistic group of small-business telephone users, on our way down the path to justice. We had no idea what a long haul we were in for. Indeed, this first meeting felt eminently successful. Telstra sent three executives; they treated us courteously and we felt that our claims were being taken seriously. We were seen, and treated, as a concerned group of small-business people who had been consistently ignored by Telstra. We asked for Austel (the government regulator) to be the ‘honest broker’ in our matters, and the executives agreed to this. They took the documentary evidence we had brought, and at the end of the meeting we were left with a sense that it was all soon to be resolved.
After that initial meeting there were a number of meetings with Telstra and Austel. Based as he was in the city, Graham Schorer was the COT representative. Under pressure from Austel, Telstra was acknowledging that faults existed, though they still held back from admitting the scale of faults we knew to be true — and indeed, as it turned out, that they too knew it to be true.
Guaranteed to network standard
Meanwhile, in July 1992 I had been obliged to ask Telstra for a guarantee that my phone service was up to standard. A bus service wanted such a guarantee (in case of urgent needs for communication) before it would contract to bring groups to the camp. Although I did not see how Telstra could guarantee such a thing on the basis of current performance, I thought a guarantee might have some use as leverage.
Not one but two guarantees eventually arrived (in the event, both too late for the purpose of securing the contract with the bus company). The first stated that my phone service was indeed ‘up to network standard’:
Whilst our recent tests indicate that your service is now performing to normal network standards, I am initiating a further detailed study of all the elements of your service and the tests which have been conducted.
The second stated:
We believe that the quality of your service can be guaranteed and although it would be impossible to suggest that there would never be a service problem we could see no reason why this should be a factor in your business endeavours.
Now I need to jump ahead of myself here, to draw on material I did not have access to at this time, but which reveals something of what was going on in the telephone exchange while my business was sinking.
In 1994 we COT members all ended up involved in arbitrations with Telstra. According to the rules of arbitration, Telstra had a legal obligation to provide us with relevant documents under the Freedom of Information Act. You will hear a lot more about this in due course, not least about the unreasonable time it took for FOI document requests to be delivered (often years too late); enough to say here, that in an FOI release in mid-1994 I received documents referring to the general congestion problem at Cape Bridgewater.
The second paragraph of a document titled ‘Subject PORTLAND – CAPE BRIDGEWATER PCM HBER’ of 12 July 1991, was of particular interest:
When the ‘A’ direction of system 2 was initially tested, 11,000 errors per hour were measured. In the ‘B’ direction, approximately 216 errors per hour were measured, 72 errors per hour is the specified number allowable.
This level of error was in fact known at least as early as February 1990, the very time my complaints were being stonewalled. And nor was it acknowledged to me at the time of writing (July 1991). And in the new exchange, the problems continued, as another document, titled ‘Portland — Cape Bridgewater — RCM System’ showed, referring to information logged in March 1993, long after Telstra had first reported these massive error rates:
The second page of this document explains why they ‘had no idea over what period of time these errors had accumulated’:
The alarm system on all three RCM systems had not been programmed. This would have prevented any local alarms being extended back to Portland.
They didn’t know how long these errors had been accumulating because, from 18 August 1991, when the new exchange (RCM) was installed at Cape Bridgewater, the fault alarm system had been left unconnected. Since this was an un-manned exchange, no-one could know when faults occurred — except, of course, us poor, defenceless customers.
This means that in September 1992 when Telstra management had written to me stating that the quality of my telephone service was guaranteed as up to network standard, they had failed to realise that this alarm had not been connected. Even the local telephone technicians were oblivious to the call loss due to the unconnected alarm system in the exchange. What kind of investigation into the faults I had reported over several years does this demonstrate? A farcical one. How, for several years, could they fail to notice that the alarm wasn’t connected?
A compensation deal
The formation of COT had come not a moment too soon for me. The frustration of struggling with problems that seemed immune to complaints, and about which I could do nothing but complain, could finally be shared. I had lost faith in my own judgement by this time; I had let down two different partners who had trusted me, and I was now borrowing from friends just to keep the camp running on a day to day basis. Through all of this, of course, the phone faults implacably continued.
The COT group continued to negotiate with Austel and Telstra, and in late 1992 our combined pressure finally produced results: Telstra approached me with a proposal for a compensation payout which included a confidentiality agreement to the effect that I would not disclose the value of any settlement which resulted from this. I signed this agreement on 11 December 1992 and I have honoured my word not to disclose the amount of the payout without prior approval by Telstra.
That same day, I went to Telstra’s city fault centre where the area general manager and I began a long discussion regarding the extent of my financial losses over the four and a half years since I first complained about the phones. This manager and I were the only people involved in this discussion. I provided her with copies of numerous letters I had received from clients and tradespeople, describing their experiences trying to ring me, and I explained how I had calculated the sum of my losses.
On a number of occasions the manager left me alone to examine documents she had given me. As she left on the first occasion, she explained that she would close the door so I could read in private and added that, if I needed to discuss anything with my advisors I was free to use the telephone: there was a direct outside line available at all times so I wouldn’t need to speak to an operator within the building. I made use of the phone a couple of times to ring Karen and talk over the offer; together we calculated how much I needed to repay her.
The documents provided by the manager were mostly hand-written and included copies of the so-called ‘guarantees’ I had received. According to one of the documents, there was only a ‘single’ fault, lasting only ‘three weeks’, that triggered the recorded message (RVA) that my number was not connected. This document claimed that the RVA probably caused me to lose only about 50% of all incoming calls over this three-week period. Other documents referred to a minor fault in the phone exchange at Heywood plus some other minor faults which may have contributed to some call loss. The manager told me Telstra agreed to accept responsibility for these faults if I agreed to their offer.
I protested, and reeled off again the continuing and constant complaints I had been and still was getting from customers. Her response was a simple ‘take it or leave it’: this was Telstra’s last offer, she told me, and the only other avenue I could follow would be court proceedings. Her final comment was along the lines that, ‘Telstra has more time than you have money to fund court proceedings.’ Reluctantly, but feeling I had no other choice, I accepted. My reluctance was well justified.
By August 1993 came my first bundle of FOI documents from Telstra. In it, astonishingly, was a Telstra minute of 2 July 1992, which revealed that local Telstra technicians regarded my complaints were correct about the ‘service disconnected’ RVA on my line. Not only that, the observation was made that the problem, ‘is occurring in increasing numbers as more and more customers are connected …’ Senator Alston raised this document in Senates Estimates in February 1994, demanding a response from Austel. No response was forthcoming, and nowhere else did this revelation gather any advance for my cause.
And two years later I received a copy of an FOI document headed Telecom Secret. This was a copy of the notes brought by the manager to the settlement meeting. The opening page, reproduced here, shows all too clearly that Telstra knew how solid my case was. The manager had blatantly misled me into agreeing to sign.
The document goes on to state,
‘Mr Smith’s service problems were network related and spanned a period of 3–4 years,’ and, ‘Overall, Mr Smith’s telephone service had suffered from poor grade of network performance over a period of several years; with some difficulty to detect exchange problems in the last 8 months.’
My acceptance of the offer notwithstanding, I continued to experience faults in my phone service, particularly call drop-outs when, part-way through a conversation, the line would simply go dead, and short duration rings when the phone would ring once or twice and then stop, with no-one there if we picked up the receiver. Finally, in October of 1992, the area general manager arranged for two testing machines (called ‘Elmi’ machines) to be installed, one at the local Cape Bridgewater exchange and the other at my office.
On 13 October I reported four calls dropping out, at 1.20, 1.40, 2.00 and 3.00, and an occasion when I had answered the phone to find a dead line. Despite the Elmi machines, the Telstra technicians found, as they had in so many instances before, no faults that they could detect. What was going on?
It was two years before I got any elucidation from Telstra, and even then it shed no light on the matter. In 1994, in a bundle of FOI documents I received was a hand-written file note stating,
‘We had the Elmi disconnected at the RCM and were installing it at Mr Smith’s house and the CCAS showed no evidence of above 1.20, 1.40, 2.00 and 3.00.’
This was simply not the case at all; I knew they were not installing it at my house at this time; it was already installed. So I asked Telstra to supply their Elmi print-outs from September–October 1992. Some weeks later a number of documents arrived, including tapes which show that the call drop-outs and dead lines that I had experienced appeared on Telstra’s monitoring equipment (CCAS) records as answered calls at approximately 1.30 pm and 3 pm.
I could not fathom why a local technician would state that the Elmi equipment was disconnected at the exchange and to be installed at my house when these two print-outs show that it was actually installed and operating at both locations, albeit incorrectly. I could only assume that all this reflected the competence and capacity of Telstra’s fault centre, as well as the accuracy of their records and reportage. That thought alone was very worrying when you are reliant on the telephone.
And now I began to suspect that there might not be a simple answer to the phone faults, just waiting to be discovered and fixed. It looked as if the problems were endemic throughout the organisation and its infrastructure.
As I struggled from the end of 1992 to the New Year of 1993 I began to wonder if ‘settling’ with Telstra had been such a good idea. Nothing had changed. I had been forced to re-finance, incurring more set-up fees, and because I still couldn’t afford to maintain the camp properly the place was looking decidedly abandoned. I felt as if I had been abandoned too. Both the buildings and I were tired, run-down and in need of a face lift!
The other COT members were no better off. Maureen and Ann had also accepted settlements directly from Telstra, while Graham had his through the courts. And for each of us, poor and faulty phone service continued unabated.
My only source of strength at this time was from my fellow COT members. One Saturday evening a couple of Scotches left me in tears of complete frustration. I knew I was easily capable of running the camp as I pictured it but instead I was trapped in a vicious cycle. Without customers I would soon be completely broke, but the customers couldn’t reach me because the phones didn’t work. Right then Graham Schorer rang, urging me to hang in there, convinced that we would win out in the end.
Yes, some calls did get through, in what proportion I shall never know, though perhaps the rate is indicated by the following story. In personal desperation, I decided to ring Don Burnard, a clinical psychologist the COT members had contacted when we were first creating the group. Dr Burnard had written a report regarding our individual conditions, noting the breakdown in our psychological defences due to the excessive and prolonged pressures we endured:
All of these clients have been subjected to persistent environmental stress as a result of constant pressure in their business and erratic patterns of change in the functioning of their telephones which were essential to the success of their businesses.
I rang Dr Burnard for support, but my conversation with his receptionist was interrupted three times by phone faults. Later I received a letter from his office, saying:
I am writing to you to confirm details of telephone conversation difficulties experienced between this office and our residence mid-morning this day, 5 May 1993. At approximately 11.30 am today Mr Alan Smith telephoned this office requesting to speak with Don Burnard. Mr Burnard was not available to take his call. During this time the telephone cut out three times. Each time Mr Smith telephoned back to continue the call.
Ann Garms and Graham Schorer had, by now, become my ‘comrades in arms’ in this war we were fighting, and we had many group discussions as we tried to find a way to deal with the evasions and deceptions of Telstra management. But we were simply three small-business people struggling against the might of a huge corporation. Not encouraging odds! We wondered if we could ever be in a position to expose Telstra’s unethical corporate strategies and continued and apparently deliberate mishandling of our complaints. And Ann, like myself, had begun to suspect that our phone lines were being bugged. I will return to this later, once we were able to provide evidence that our concerns were valid.
Early in 1993, as spokesperson for COT, Graham Schorer met with Robin Davey, the chairman of Austel (the telecommunications industry regulator) to discuss our way forward. Austel was sympathetic to our situation. It recognised we had been let down in our settlements and sought to establish a standard of service against which Telstra’s performance could be objectively measured in any future settlements.
Meanwhile, COT decided it was time to try to inform the Australian Senate of our plight. We sent submission after submission, with supporting FOI documents, and followed through with visits to Canberra, financed from our already depleted pockets, to meet with ministers who were sympathetic to our case.
By now I had accumulated more than seventy letters from customers who had been unable to reach me by phone. This example, from a year 7 co-ordinator for Hamilton High School (now Bainbridge College), who brought his group along every February from 1990, is typical:
I wish to acknowledge in writing the repeated difficulty I have had contacting Alan Smith at the Cape Bridgewater convention centre by telephone. In the week March 1st to 5th I made 5 or 6 attempted phone calls to Alan but I was unable to get through, indeed the line was ‘dead’. This was extremely frustrating and had I not been aware of Alan’s phone problems, I would have used another camp site.
Astonishingly, one letter, dated 17 May 1993, was from a senior Telstra technical engineer, who wrote regarding his own experience of trying to ring me:
On the 24/2/93 I received a phone call from a technician at Portland who stated he had been given a fault from (1100 fault dept.) indicating a customer in Ballarat had trouble calling your business 055 267 267. I then attempted to ring 055 267 267 myself, the ring was tripped after several bursts, i.e. ‘answered’ and I received a loud noise similar to a radio carrier noise and a very faint ‘Hello’.
At last, a second person inside Telstra acknowledged that I had a problem with the phone service! The engineer had even given me his name. Yet in the course of their defence of my arbitration claims, Telstra proffered a Witness Statement from this man (made in December 1994) that included no reference to this (see Summary of events/Chapter Two to Five)
Was the engineer pressured to stay quiet during my arbitration? I don’t know. Certainly, not all Telstra engineers or technicians treated COT complaints in good faith. Another Telstra technician, who experienced major problems during his official fax testing process on 29 October 1993, nevertheless advised the arbitrator that I had no problems with that service, even though the Telstra document that discusses these faults notes:
During testing the Mitsubishi fax machine, some alarming patterns of behaviour were noted, these affecting both transmission and reception. Even on calls that were not tampered with the fax machine displayed signs of locking up and behaving in a manner not in accordance with the relevant CCITT Group 3 fax rules.
In a similar incident, an FOI document regarding a complaint I lodged about my own phone service bears a hand-written note which states: ‘No need to investigate, spoke with Bruce, he said not to investigate also.’
Where was this attitude coming from? If from higher management, it seems an odd way to do business: exacerbating our problems so that we would only complain more.
In the first five months of 1993 I received another eleven written complaints, including letters from the Children’s Hospital and the Prahran Secondary College in Melbourne. The faults had now plagued my business, unabated, from April 1988 to mid 1993.
By now, due to COT’s pressure in Canberra, a number of politicians had become interested in our situation. The question was, would these politicians actually take any action on our behalf, or would they protect the ‘milking cow’ of the Telstra corporation?
In June 1993 the Shadow Minister for Communications, the Hon. Senator Richard Alston, was showing an interest. He and Senator Ron Boswell of the National Party both pushed for a Senate Inquiry into our claims and, I was recently told by an ex-Telstra employee, they were very close to pulling it off. If this Senate Inquiry had got off the ground, heads in Telstra might have rolled but it this didn’t happen, and those same ‘heads’ continue to control Telstra to this day.
Even though Senator Boswell is based in Queensland and most of the remaining members of COT are in Victoria, he has continued to offer his support. David Hawker MP, my local parliamentary member, was another who saw his ‘duty of care’ to his constituents and so answered our call for help. He took my claims seriously — indeed, he took the problem of poor phone service in his electorate seriously and was appalled at its extent. Mr Hawker sent me letters of support, put relevant people in touch with me, organised assistance for me, and has continued to go into battle on COT’s behalf for ten years now.
Non-connecting calls
While the politicians tried to launch a Senate Enquiry, COT continued to lobby Austel for assistance. Yet another telephone issue was affecting my business. In February 1993 I installed a 1800 free call number to encourage telephone business and right from the start experienced problems. Many calls to this number were not connecting; the caller heard only silence on the line and typically hung up. The business was thus potentially losing a client, but adding insult to injury, I was being charged for these non-connecting calls. Even worse, in many instances the caller heard a recorded announcement from Telstra to the effect that the number wasn’t connected. I first knew this problem was occurring through people reporting their difficulties trying to reach me. After this, I checked my bills carefully.
According to Telstra’s policy, customers are charged only for calls which are answered. Unanswered calls are not charged, and include:
… calls encountering engaged numbers (busy), various Telstra tones and recorded voice announcements as well as calls which ‘ring out’ or are terminated before or during ringing.
Between February and June 1993, I provided Austel with evidence of erroneous charging on unanswered calls on my 1800 service (in fact, it went on for at least another three years after that). John MacMahon, General Manager of Consumer Affairs at Austel, wanted a record of all non-connected calls and RVAs that were being charged to my 1800 account. In order to provide that, I needed the data from my local exchange.
Both Austel and the Commonwealth Ombudsman’s Office were aware that I made repeated requests of Telstra, under the rules of FOI, to provide me with the relevant data. Yet despite the involvement of these institutions, Telstra held out on me. In the end, it was more than a decade later that I received any of the relevant information, and that was through Austel. And of course it was too late by then, the statute of limitations on the matter had long expired.
I did not understand then, nor do I understand now, why Austel, as the government regulator of the telecommunications industry, was unable to demand that data from Telstra.
From June 1993 I had proof myself that Telstra knew the faulty billing in the 1800 system was a network problem from its inception.
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