There is growing speculation that Telstra might not renew its $1.2m arrangement with Macquarie Radio to sponsor 2GB’s Alan Jones program.

The agreement expires in June 2005, and there are major concerns over the increasingly negative publicity surrounding the deal.

However, Telstra has defended the sponsorship, saying it is a commercially sound investment and it does not impinge on 2GB’s editorial comment about the telco or its competitors.

There have also been renewed calls for further investigation of whether Telstra had hoped to influence public debate about its service levels in a manner not obvious to the listener.

Responding to questions from the ABC’s ‘Media Watch’, Bill Scales, Telstra’s Group Managing Director of Regulatory, Corporate and Human Relations, says the popularity and reach of talkback radio programs means they are a cost effective way to advertise products and services.

“The Telstra arrangements are transparent and we do not exercise any editorial control over what John Laws or Alan Jones say about Telstra or our competitors.”

Phillip Adams, writing in The Australian also pursued the Telstra angle to this story, linking Sam Chisholm to “the rivers of gold flowing from Telstra to Jones,” saying the story involves “complexities and conflicts of interest” that would take a lifetime to sort out. Adams’ analysis went further, linking the government, through Chisholm, to attempts to dominate media interests for political gains.

He made the point that Chisholm has links with Macquarie Radio and Jones and is also on the board of the taxpayer majority owned Telstra. Adams wrote: “[Telstra is] doling out millions of our money in one of the ongest running scandals in Australian history. The longer you look at it the worse it gets.

He urged Telstra to apologise and extricate itself from the deal.

For more on Flint/Jones/Laws from the newspapers, click on ‘Paper Clips’ in the red left hand column.