Telstra makes mockery of NBN tender process

Stan Beer
Thursday, 27 November 2008 10:12

IT Industry - Tenders

The NBN should have been well under way by now and the last thing the Government needs, if it decides to go with someone other than Telstra, is an underfunded non-performer that has underestimated its bid, making the Government look bad and messing up its chances for re-election in 2010.

On the other hand, if the Government awards the bid to Telstra on the strength of its current RFP submission, the tender process becomes a farce and the legal challenges would come flying from the other parties, all of whom would claim that Rudd’s NBN was a dud from the word go.

What's more, Telstra has yet to submit a detailed proposal, so if the Government does decide to keep Telstra in the game, then more time will be wasted on negotiations over Telstra's demands and the amount of coverage it is prepared to guarantee.

Senator Conroy told a Macquarie Southern Cross radio program today that the panel judging the bids will take another two months before it announces the winner. He also said that the Government would not be prepared to put in a single cent more than the promised $4.7 billion and that the Government was sticking by its "election commitment" that the NBN will provide 98% coverage.

According to Senator Conroy, Telstra is simply trying to draw more money out of the Government to achieve its 98% coverage demand.

However, Telstra states clearly in its non-compliant mini-proposal that it will need a much larger contribution from the Government if it is to achieve 98% coverage as the "costs increase exponentially" to reach that extra 8% of the population – up to $5 billion more, according to Telstra’s chief lobbyist (and Dr. Phil Burgess replacement), David Quilty.

However, this is not only about the money. Telstra in reality have not even submitted a proposal. Apart from a brief mention about partnering with Alcatel-Lucent, there is no detail about the implementation or rollout whatsoever. Ericsson must be disappointed.

Therefore, the expert panel will presumably be expected to judge Telstra's "bid" on the basis of a document that is really just a political letter to the Government saying what the carrier will and won't do. How could it possibly make a decision on that basis?

Senator Conroy also said today that the NBN will take five years to roll out. However, the way things are going, he may not be around to see work on it started.