Mitchell Bingemann | August 26, 2008
AUSTRALIANS living in metropolitan areas may be logging on to the internet using the Government's $4.7 billion national broadband network as early as next April, although regional users will not be so lucky.
Industry analysts say such a scenario is only possible if Telstra wins the lucrative bid and if the Government is prepared to place an indefinite hold on extending the broadband services to underserviced regions.
The project, which has already blown its original schedule by six months, is finally back on the rails after 13 telecommunications carriers submitted their network information to the Government last week.
Proponents will use the information that details Australia's network infrastructure to bid for the contract to build a network capable of delivering high-speed internet to 98 per cent of Australia's population.
The network information is currently under review by Communications Minister Stephen Conroy's department, but it is expected to be delivered to each of the bidders for the network by early next week.
Once the network information leaves Senator Conroy's department, proponents will be given 12 weeks to finalise their bids ahead of a tentative submission deadline in early December.
Bids will then be passed on to a panel of experts, which will be given two months to assess the proposals and to identify preferred proponents.
An additional two months negotiation time will then be available before the Government signs off on the winning bid at the beginning of April - if all goes according to plan. With a good chance that a winning bidder will be announced in early April, there's an equally good chance that first services from the network could be delivered the same month.
Despite having firmly pencilled in a date for the announcement of the successful bidder, Senator Conroy declined to suggest when first services could be expected. This is not surprising as he has been stung in the past by premature predictions.
"The Government has a live, commercial selection process under way for the national broadband network and it is therefore inappropriate to speculate on the potential outcome of the request for proposals," a spokesperson for Senator Conroy said.
"It has always been the Government's position that the provision of appropriate network information to proponents is important for the success of the national broadband network process and that this should be done as soon as possible."
Earlier this year, Senator Conroy said the tender process faced tight time frames, but he expected the process would meet the Government's election promise of delivering the first services by the end of the year.
The latest estimates place first services in April next year.
Although Senator Conroy yesterday backed away from a first service forecast for the network, several analysts have predicted that services could be available just weeks after the successful bidder is announced.
"If Telstra win the bid, it will switch it on straight away in April," telecommunications analyst Paul Budde said.
"That is, of course, if the Government goes for a quick fix instead of an innovative and open access solution."
According to Mr Budde, if the Government is able to stick to its deadline, Telstra will be able to switch on the netrork in metro areas within a week of being announced the winner.
However, going with the quick fix would come with its own set of problems, he warned.
"In 2009, with or without the network, Telstra will still deliver 12Mbps to all metro areas. If the Government decides to go with Telstra there will be no competition and under-serviced areas will suffer," Mr Budde said.
"Telstra is not interested in pursuing the spirit of the network, which is about open access and broadband for under-serviced areas."
Mr Budde said the correct decision would take longer but would benefit more Australians in the long run.
"It would be much better if the Government stuck to its election promises and picked a network based on open access. Even though this may mean Australia won't see services for some months, it will be worth it."
Market Clarity chief executive and analyst Shara Evans said the network's build time and its first deliverable services would be decided by how quickly the winning bidder was able to mobilise its workforce and secure the necessary telecoms equipment.
"It all depends on who the successful bidder is, how quickly they can mobilise, whether they have contractors lined up, and if they have already pre-purchased fibre equipment," she said.
Regardless of winner, the Australian public could expect first services from the network next June, but only if the winning bidder had pre-purchased equipment on standby, Ms Evans said.
"If the proponent hasn't selected a vendor we can expect more delays," she said.
If having surplus equipment ready becomes an issue in the tender process, it may prove to be a thorn in the side for telco consortium Terria.
Although it's widely believed that Telstra has already chosen long-running infrastructure supplier Alcatel Lucent as its preferred vendor, Terria is yet to enter discussions with vendors.
Terria bid manager Michael Simmons said it was not necessary at this stage to have a preferred vendor.
"We've been sitting on selecting a vendor until we get the network information and the clock starts ticking. We are making a short list because we may need multiple types of technology from different vendors," he said.
Despite Terria's current vendor uncertainty, Mr Simmons is confident the consortium will be able to switch on services for under-serviced areas within three months, if its bid succeeds.
Your Comments:
34 Comment(s)
I can't believe people are so against Telstra getting this contract and believe their competition to be the ones that "care for the bush" and are compassionate. It's nice to see you all fooled by the rhetoric of these other providers....they are all in the game for the same reason as Telstra. The only reason you are p***ed with Telstra is beacuse they won't cut their prices like the so called "compassionate" competition as they have other differentiators. The competition only have price as a differentiator and hence why they cut price to the bone.
Delivering services in Australia....to ALL Australia is bloody expensive and if you are the company actually delivering to every where and not just cherry picking then you will need to charge more to recoup your costs. end of story.
Harri of Adelaide - That is correct. If Telstra get the tender all they will have to do is flick the switch on all the ADSL2 DSLAMs which are deployed in most sites around Australia, but not activated for business/commercial reasons. Then they will begin rolling out whatever scheme they have in the pipeline. - TRY TO REMEMBER THIS IN 12 MONTHS TIME - If Telstra get the tender, and all of a sudden 1 week later have "already started the roll out, because that is how committed we are to you Australia!!!" DONT PRAISE THEM, they haven't even dug their first hole yet!!! But we will forget . . . Most people have already forgotten about how 3G/NextG came to being.
Speaking of backwards. Did you know that currently on a 20GB per month cap "full speed" ADSL link here in central Auckland (holds 1/4 of NZ's population at 1.3 million) I pay $60 per month and yet my standard download link is approx. 1.5Mbps on average. They state the line speed is 7.5. I call them up and ask why it is so slow and they tell me it CAN go 7.5Mbps but the standard is anywhere between 512Kbps and 3.5Mbps so my speed is normal. Also, they only just recently upgraded the uplink from 128Kbps to 890Kpbs, yet here at work at the School I'm a network admin for, we're on a 45Mbps up and a 45Mbps down.
Don't give it to Telstra to make a monopoly, but don't give it to anyone who isn't ready either, we need to ensure the company or companies that do get the deal are going to get that broadband to a minimum of 98% of Australians, especially the bus who have suffered the worst end of the IT growth who still are forced to connect at 33.3kbps dial up.
Please, don't award the contract to Telstra. They care little about anything else but having a monopoly and enjoying huge profit. Please, put some healthy competition in there and force Telstra to serve Australians, not rip us off.
Wasn't there an OPEL proposal months back that was going to service these regional areas for about $1b in 2 years? Wasn't the contract signed by the previous government? Didn't the current government cancel this? I would've thought if you felt the need to cancel it then you would promise to get these regional areas serviced in the same amount of time.
Interesting reading from many who clearly have no idea of the magnitute what an NBN, covering 98% of the population equates to. It is astronomical. The Terria bid is clearly a joke - no vendor, no plan, no proven record. This is the largest network infrastructure build this country has seen. Telstra - love 'em or hate 'em, they are the only mob that can realistically fund & build a NBN.
Who, with any business sense would invest capital into regional australia, when their return on investment is negative. My regional cousins- "get real", the government owes you nothing. Would you buy metro real estate to graze cattle? I didn't think so. The Govt $4.7B is merely the carrot to get Telco's to cover the bush.
Get Real. Telstra are the only ones capable of delivering this solution and - like it or not - are the ONLY ones committed to the bush. If ANY of the other players cared about the bush, then where are they? If you and I had 100 million to start a phone company, would we put mobile towers in the middle of nowhere so it takes a thousand years to break even? No, we slap a tower in the middle of Sydney and Melbourne and start making money from day 1.
Telstra has existing infrastructure nationwide, so they are the only ones that can deliver this on time and on budget. Anyone else trying to do it would have "cost overruns" that would be passed on to the government (you and I as taxpayers). We have already paid for one phone company to build infrastructure (Telstra). Any other company wins this bid and us taxpayers will be stuck with the bill of building the same thing THAT IS ALREADY THERE for another company.
re:warlok of noosa - Labour has to create positions for their union buddies somehow. What's a better way to waste tax payer money than is spend it on technology which very few people understand?
Pleeeaassseeee don't give the contract to Telstra - they don't deserve it the way they rip off consumers.
Please - get real guys. In technology terms Australia is third world. Politicians are self-serving. Telstra is a business i.e. it's raison d'etre is simply to make money. It is not a social service.
NextG, is already capable of operating at 14.4Mbps to 98 per cent of Australia's premises, it is only the local mobile handsets and home modems that are currently limited to 7.2 Mbps. 14.4Mbps modems are on the market elsewhere in the world. Trujillo has already said he expects to lift the speed of the NextG network to 21Mbps a second next year.
If Telstra loses to the Terria it could simply upgrade the NextG network, predatory price it and destroy Terria with 21Mbps broadband across Australia. If Terria loses, Optus or Vodafone could do the same.
Incidently last weekend the GSMA - 750 3G mobile phone operators around the world - small bias maybe - stated mobile broadband will reach speeds of 100Mbps before fibre optic does in 2013 i.e. in about two years.
Keep digging in the mines guys we are about to burn $10bn. No doubt they'll blame John Howard.
Nice one Tony of Melbourne - "State of the art"? Fibre to the node is obsolete in the rest of the developed world already. 12mb/s? Sounds just like the Telstra of old, holding the enitre country back claiming the network was limited to 1.5mb/s - Only to be proven wrong by smaller, innovative, 100% Aussie battler isps.
You were right though, they do have a proven record - unfortunately it's for holding the country back in order to line the pockets of a small minority. (And yes, Telstra shareholders are a MINORITY of the population. Do the math.)
Pointless if Telstra are gonna run it.....the services will end up being a rip off.
Well I thought 55gig/ADSL2 for 90 bucks a month was a good deal (Internode) until I read expat of Japans comment.
They're dreaming if they think they can get any real service running within weeks that is anything but smoke and mirrors for the Conroy photo-opp. Don't know which analysts provided their commentary but they've got blinkers on.
What a laugh. What happened to ADSL extending to 10-15kms? Oh that's right we got 3G instead. Don't go looking for that press release on the Telstra site, they removed it. I'm sure there is a copy on Whirlpool.
I'm confused... If they are able to have the service switched on within weeks of the sucsessful tender being announced does this mean we already have the infrastructure in place? If so then why is it going to cost around $10B to implement it including $4.7B of taxpayer money??? Maybe we should be looking at some different legislation to enable it without the huge spend. As an aside, it's interesting that I have been waiting over 6 months for Telstra to install a new ethernet link into my office yet they can potentially open up a full 12Mbps service nationally within a week of being given a $4.7B handout form the govt....
Looks like 31.2k dialup till I die , we have Next G out here but I can not afford giving all my wages to Telstra ,
I'm confused by this article, it states "Telstra is not interested in pursuing the spirit of the network, which is about open access and broadband for under-serviced areas." As far as I'm aware, the Telstra bid and any other bid is for an open access network so stop misleading the public with anti-Telstra lies and mis-information. THE National Broadband Network IS OPEN ACCESS, period.
Thing is, we all know it's already set in stone. Telstra will get the contracts, Telstra will get the funding, Telstra will put the service in the capitals, Telstra will make a fortune, Regional Areas will suffer, Other ISPs will suffer, Telstra will dominate market. C'mon. It's obvious that the government don't regulate Telstra's prices strictly enough.
@Tony of Melbourne. They must pay well to troll this stuff like you do mate. Go back to nowwearelying.com and sprout niceties over there. This is for serious comments not paid infomercials. Oh - check your 3G prices and system stability too. Lol at them, great stuff to use as a comparison. Makes me sick to think we could have that "world class" pricing on the new (snicker) world class system. Conroy Telstra = epic fail.
If 12 Mbps is all that we can expect from a new network, then they must be joking. That is a disgrace. Here we have the opportunity of waiting to the very last so that we may choose the best technology available to give us the fastest speeds and we end up with something the rest of the world has had for the last 20 years. It is like buying an old car and pretending it has the latest technology. What a joke!
Please don't give it to Telstra. It is because of Telstra that I can't get any form of wired internet. Look up 'pair game' and 'rim port' and see how Telstra is screwing over the population already. I live 15 mins from the Brisbane CBD and can't get any wired internet because of Telstra's money saving tactics.
The NBN is an expensive mistake and should be dropped. The terms of reference are poorly conceived, the specifications are too low and the service is NON-essential after all. If people really want broadband they can have it now and there are many options. BUT, most people aren't willing to pay for high speed, so why build it everywhere? The billions of dollars to be wasted on an amusement service would be better spent funding renewable energy and public transport.
well anyone with half a brain knew the country was never going to get fibre to the home. there is zero business case for it. Getting it into cities as fast as possible is the correct decision. The important thing with country is to make sure that they're not left out as soon as the cities are wired up. The country is financially unviable. I will say this again and again. Government should pay for and build our rural infrastructure. You can never make a business case for it and you never will. The cost of deployment is insane for country.
...and meanwhile, the rest of the world continues to enjoy broadband architecture that makes Australia's look utterly pitiful in comparison. I'm in rural Japan, and I have 50mbps ADSL with no download limit, for about $40 a month. Get your act together Australia.
Thank you Mr Howard for selling Telstra and not doing anyting for 12 years. We will be paying huge amounts of dollars per month with limited downloads, BigPONG plans are just like that. Once again thanks MR HOWARD.
As usual the government thinking about where the most money is, and the country areas are given even more reason to distrust and have great contempt for us metro folk.
It really pees me off about all this broadband junk. We live approx 20km from the cbd and can not get broadband. But those living in the outback can get it. Telstra needs to stop trying to save money and give everyone phone lines that can actually use broadband.Or those who cant get it, telstra should be paying for a new phone line
*sigh* Here we go. Sorry country Australia your world class (snicker) service will be suspended for a decade (or 2). Sorry for the inconvenience old chaps. Just remember to vote for us next time. We watch and make promises we don't keep but have nifty conventions and celebrity friends. Cate said it was Ok to leave you all out for a while. She will get hers.
An interesting read. Especially for people located in regional areas unable to get broadband [satellite doesn't count as too slow, too expensive] and on dial-up with a flat out speed of 26.4Kbps.
If the Govt. doesn't buy back the copper network, we will pay through the nose for this. Stephen Conroy is a fool of Richard Alston proportions, so don't expect the Australian public to get a good deal. Privatising Telstra was a big mistake.
Why should anyone be surprised that us folk in the regions should miss out to our country cousins? It has always been thus under a Labor government, and no realistic person would or should have expected anything different.
Well it is plain and obvious the Terria bid isnt as prepared as the Telstra bid at this stage and going forward with the Terria bid would be like the blind leading the blind as with the Telstra bid we will have an outcome that is going to work if you draw on past achievements namely NextG as a resent example so lets be clear about this as Australians we expect a state of the art network to supply our needs well into the future and my moneys on Telstra a sure favourite with proven ability why choose an outfit unprepared for the biggest network ever built !
Nothing new here. Telstra still has no intention to help regional Australia. Senator Conroy, please don't give the deal to Telstra, They want to continue to be the monopoly that dictates to regional Australians and hold them by the throat. Wasn't the NBN for all of us, not just Telstra's arrogant sellection of the population?
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