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Govt announces new rules for Telstra to ease -

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(generated from captions) The Government has moved to ease concerns in rural Australia over a possible final sale of Telstra. The Communications Minister Helen Coonan has announced a new condition on Telstra's operating licence. The telco has six weeks to come up with a plan detailing how it will maintain an effective presence in the bush even if Telstra is privatised. But in the small town where the announcement was made it was abundantly clear that privatising Telstra remains a hard sell. Norman Hermant reports. You could wait for a long time waiting for something to happen in Kendall. But today, this quiet town not far from the mid-north coast of NSW was at the centre in latest round of manoeuvering over the future of Telstra. Hi. How are you? The Federal Communications Minister was here in National party leader Mark Vaile's electorate. Well, we put on a good service, Mark. That's all I can say. Helen Coonan wasn't only admiring the Deputy Prime Minister's website. The senator was here to announce a new condition for Telstra's operating licence. It will now have six weeks to draft a local presence plan, spelling out how Telstra will continue to provide visible and effective service in regional and remote areas. As to how much this will cost, or what specifically is expected, the Minister says the ball is now in Telstra's court. From my personal perspective I don't think its appropriate to prescribe for Telstra what precisely they must do. What I'm interested to do is see what they offer up and I will then make a judgement based on the guidelines that I have issued in writing as to whether I think that's appropriate. Just two days ago new CEO Sol Trujillo took aim at the regulations governing Telstra. Today, Mark Vaile tried to downplay the impact of those comments. When they're talking about their concerns as far as the regulatory regime, they're predominantly directing their concerns at the competitive market in the urban areas of Australia and the business world in Australia. Not necessarily at the areas where we're talking about focusing our energies on. Press conference over, it was time for local politicians to have their say with their high-powered visitors. Coming to the country to make announcements about service guarantees, meeting with regional councillors - as the Government prepares for a possible final sale of Telstra, this is all about winning the battle for hearts and minds in the bush and you don't have to be in Kendall long to discover when it comes to privatising Telstra the Government has a very tough sell on its hands. Something's gotta be kept government. That way it's kept in line. Otherwise - nah, nah. Business ruins everything, big business. Not good for Australia. Over and over, it's the same response. No matter how many guarantees the Government puts in place people here are wary. It will probably be worse if it goes private because like the way it is now with the Government we're not getting a very good run as it is, are we? So if it goes private the private mob will just say "too bad" when you start complaining I suppose. Down the road, just out of town, Bev Yarnold is also concerned about a future when the Government no longer owns Telstra. That's the fear we have. When it's out of our hands we don't have any say. Private companies do whatever they like usually. I suppose governments do too, but it just feels more secure as a government service And that may be the Government's biggest hurdle. They can tempt Australians with arguments for Telstra's sale. They can provide iron-clad guarantees to safeguard service. But after all that, can they overcome the public fear of a private Telstra. Norman Hermant, Lateline. To the markets now. The All Ordinaries ended slightly higher as investors remain cautious