Basslink bites back: plans to be a wholesale carrier

Stuart Corner
Thursday, 15 May 2008 11:40

Business IT - Networking

In its announcement it said that "After several months of constructive work and engagement with the Tasmanian Government and with Aurora, we are optimistic of being able to reach an agreement, and ultimately to provide choice to broadband users in the State. We understand and embrace the Government's target of achieving genuine price competition for broadband services in Tasmania and remain confident this can be delivered."

The Government, however has in recent weeks been under great pressure for its failure to deliver on its promised deal with Basslink. This delay lead earlier this month to the formation of a lobby group, Digital Tasmania.

Responding to comments from Greens deputy leader Nick McKim, treasurer Michael Aird appeared to suggest that CitySpring was wanting to charge high prices for access to tis fibre. He said: "simply lighting the Basslink fibre...will not improve the competitive market in Tasmania, given the commercial intent of the current owners of Basslink. The Government understands the frustration of all stakeholders. We too are frustrated but negotiations have been complicated and the Government will not accept a second-rate broadband solution for Tasmania."

Digital Tasmania spokesman, Andrew Connor, responded to CitySpring's announcement saying: "It is clear that CitySpring does not believe the Tasmanian Government had the exclusive right to commercialise the Basslink optic fibre. This directly contradicts claims made by this government in the RFP that was issued in 2006 to find an operator for both Basslink and the on-island fibre network...This government simply must answer the question on everyone's lips: if CitySpring is going it alone, why are we committed to paying them a total of $30 million through to the year 2021?"

He was also sceptical that CitySpring's entry into the market would bring down broadband prices in Tasmania. "Going from a monopoly to a cosy duopoly is not the result we are looking for...CitySpring and Basslink must guarantee realistic and competitive prices across the strait."

However even if CitySpring achieves its aim of becoming a commercial wholesaler, unlike Telstra it will not be able to offer redundancy through route diversity.

• On Thursday 22 May the technical project manager for the Basslink fibre cable, Paul Brooks will address Atug's regional communications conference in Canberra .