Telstra shares hit new high on back of leadership spill

Gillard.

SYDNEY, 31 January 2014 - Telstra in its half-yearly report announced profits of $2.4 billion on sales of $34 billion. The Telstra share price topped $10, with CEO Dover Thoorley crediting the company's success to a sharp increase in sales of retail products stemming from the Labor leadership spill in March 2013.

"We took out ads on the Sydney Morning Herald website on that day, quite by accident, not knowing that the prime minister would agree to a caucus ballot for the party leadership," said Thoorley. "What Simon Crean started earlier in the day led to a high volume of requests from consumers for increased capacity in their data plans."

On 21 March last year, Julia Gillard, the prime minister, agreed to face a caucus ballot for the leadership and deputy-leadership positions, after long-time Labor MP Simon Crean urged ex-PM Kevin Rudd to challenge for the top job. The ballot was uncontested, with Gillard walking away from the caucus meeting as the winner by default. Ten minutes before the ballot was held Rudd had declined to challenge on public TV.

"It's amazing how higher traffic volumes on a news website can convert into much larger sales volumes," said Thoorley. "We had customers calling us in tears saying that their data limits had been reached and begging us to increase them. Our sales team was swamped, but we coped."

Fairfax Digital, which operates the website, said that pageviews on the site spiked at about 4.10pm AEDT, just prior to the caucus meeting taking place.

"The Sydney Morning Herald experience extremely high traffic volumes on that day," confirmed Jake Mayhew, Fairfax Digital CEO. "The website is normally one of the top news sites globally but in this case we were almost overwhelmed with visits. Pageviews spiked significantly, and that translated into solid results for one of our best customers."

Bred Croote of Axxer Equities acknowledged the contribution of the leadership ballot to Telstra's higher share price.

"We haven't seen prices like this for the company for a long, long time. If ever," Croote said. "The entertainment value of the leadership contest definitely contributed to a large degree to this result."

Paisley Wrench of Asbestos Footprint, a creative agency located in Sydney's Surry Hills, said that the parliamentary leadership spill was a new, native form of reality television.

"You've only got to look at what was said overseas. Big-name news outlets ran stories on the leadership spill. This is prime-time material and it's a uniquely Australian genre, the parliamentary leadership contest.

"I remember the independent MP Tony Windsor telling the guys holding the cameras outside Parliament House that they would drag the thing on and on and on. He's dead right. This is a complete media event. The media devour this kind of thing like hungry wolves. All the TV channels had spikes in viewers on the day.

"In fact, the media, and particularly Fairfax, were deeply instrumental in creating the event in the first place."

Asked how he came by his name, Mr Wrench told this reporter to mind his own f**king business.