Michael Sainsbury | August 26, 2008
IT has been some wait but the tender process for the Rudd Government's rather grandly named national broadband network is almost ready to proceed, now that Telstra has been given a tick on its network information.
Communications Minister Stephen Conroy needs to get moving on the national broadband network tender
The Government had wanted to name the successful builder in the next two months but will now have to wait until next year. It had wanted to have the build started by late this year but conveniently forgot about Telstra's hard-line tactics, its own lightweight department and the global credit crunch, which will make financing for those with skinny equity models.
As well, the Senate launched an inquiry when the Coalition still had control ahead of the June 30 changeover.
Welcome to the real world, Stephen Conroy.
The network information is likely to be provided in several batches, the first this week.
Bidders will be given the information they need for submitting tenders for the project and the $4.7 billion taxpayer subsidy that comes with it.
On the Senate inquiry, there were supposed to be hearings on August 19-20 but the deadline for submissions for that unnecessary gabfest - which will have no bearing on Government policy - has been extended until September 12.
At least Telstra has parted ways with Phil Burgess. The company is now in a position to conduct a complex and delicate negotiation with the Government on the possibility of building the network. It will have to hand over some concessions in return for what it wants.
As Telstra and Optus - with a little help from its seven friends - fight it out in the dusty halls of the Communications Department and the more polished hallways of Parliament House, the nation's third-biggest telecommunications company, Vodafone, has some big decisions to make.
Any new network that takes fibre closer to end users will feature heavily in the groups's thinking.
The Australian division of the world's biggest mobile company has certainly had a strong revival since Kiwi Russell Hewitt took the reins from the out-there Grahame Maher in 2005.
Hewitt and his well-regarded sidekick, marketing chief John Casey, the mobile operator's effective No 2, have radically cut back Vodafone's reliance on low-spending and unreliable pre-paid customers and bulked-up contracted users.
Having brought some stability to the company they will now be looking to the next step.
The broadband land grab is well and truly under way. It started in fixed line, where more than 50 per cent of homes now have some form of high speed internet.
Since Telstra launched its market-changing NextG network, everything has been mobile broadband. That move will only get more intense and popular when the next wave of mobile technology - known as long term evolution (LTE) - brings speeds of up to 50Mbps.
Vodafone's basic options to bulk up its business are to build something itself - which it is moving towards with the extension of its 3G network to 96 per cent of the population - buy another company, or do a long-term commercial deal.
There were some talk on Vodafone buying Hutchison's 3 network last year but it fell $1 billion short of the $4 billion asking price.
Last year, Vodafone and AAPT had a three-month trial of reselling fixed-line retail for consumers. It didn't work but on the business side Vodafone now sells resells AAPT broadband under its One Vodafone brand.
It may go further.
Twelve months after Paul Reynolds took over, Telecom New Zealand appears to be in worse shape than ever. Rather than AAPT being back on the block, it was never really off and could yet be sold off. Vodafone is an obvious buyer, as is Optus.
Fibre to the node could be the best answer, if it ever happens. Backhaul and capacity are the mobile sector's biggest issues. Every node can become a base station. Last-mile access over wireless will be far far cheaper than copper or more fibre. It will completely recast the economics and the shape of the fixed-line sector but mobiles as well.
Now, if only Conroy can get a deal done.
Your Comments:
7 Comment(s)
Absurd - Telstra is duty bound to look after it's shareholders..the Govt and us. Profits pay our dividends.Tujillo ensures market share is the telco's goal, the bush is secondary and it was JH and Andersen who decreed Broadband would be available in the never-never. Fact is, it's a promise without committment. You may never seen cheap movies whilst Tujillo is CEO. Tough titty.
To Omni of WA (2:41 on Aug 26) - The USO (Universal Service Obligation) requires Telstra to have an exchange there, even if the area is currently unprofitable. Two things. Firstly, ALL telcos pay for the USO, so efectively the other Telcos are subsidising Telstra. Secondly, Telstra have been making it difficult for competitors to access exchanges from day 1, so they have an additional layer of complexity and embuggerance to cope with.
To Omni of WA, I think you will find the government subsidised the broadband infrastructure in the bush.
Matt - if Telstra don't care about the bush, which carrier does? Out my way, mobile coverage maps from vodafone, optus and 3 are very pale in comparison to telstra. Also Telstra provide broadband at my exchange and no one else does (aside from reselling telstra's service). I probably agree that they do not care too much, but telstra care more than others and enough to put their money into infrastructure to service us bushies.
Im pretty dam sure Telstra will offer low prices on any new network it builds though the actual cost of building a massive NBN will be high and if the government are willing to throw taxs payers money at it and build it themselves then you can be assured of a subsidised network barring that the money will have to come from the private sector and that wont come cheap so we could pay higher taxes so the bush can download bigpond movies on the cheap or we can go for the private sector with its profits and all !!
My main concern with the whole fibre to the node network is the cost for consumers and also regional Australians to get decent broadband access as I don't trust Telstra as they will jack up prices like they do now and they don't care about regional Australia so i hope that someone else wins the bidding for the network
The Government should insist that any NBN start with the bandwidth impaired, fill in the gaps (with current coverage) first. This won't be popular with telcos but it is the only way the last 2% of us will ever get back on the grid.
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