100s of contractors lose out: Telstra gives $2.4b of work to just three

Stuart Corner
Monday, 03 September 2007 10:43

IT Industry - Deals

Rocca, then group managing director of Infrastructure Services, said "Telstra's decision to consolidate the numerous separate access network contracts it had three years ago into a group of prime contractors has provided considerable commercial and operational benefits. The streamlined arrangements have also contributed to improvements in service performance and network reliability as evidenced by quarterly.

Service Stream (ASX SSM) was formed in November 2004 with an IPO to raise $11 million for the acquisition of Skilled Engineering's Communications division, which had been struggling since failing to win any share of the business in that November 2003 contract round.

Service Stream has since acquired Pracom, TCI and General Purpose Group which specialised in the construction and maintenance of wireless networks. It has also gone on to win a string of lucrative contracts from Telstra, most recently, in May this year, a contract worth an estimated $35 million per year to maintain Telstra's 30,000 payphones for three years, with two one-year options.

Service Stream estimated that it would earn in excess of $300 million annually over each of the four years of the new contracts. Its contract - for Access and Associated Services (AAS) - replaces existing contracts with Telstra that covered installation and maintenance and specialist services, worth approximately $55 million in the 2007 financial year.

Service Stream said: "The new contract represents the company's move to full national supplier status with Telstra. This involves the supply of services to each state and capital city across Australia.