Looking for upside as AAPT exits from National Broadband consortium

Stuart Corner
Friday, 17 October 2008 05:31

Opinion and Analysis

Telstra's public position is that the network will be built on its terms or not at all. But when it comes the crunch I am sure there are many persuasive arguments at the government's disposal to make it do otherwise.

Terria meanwhile is putting a brave face on the situation, claiming that it will submit a viable and full funded bid by the 26 November deadline. Chairman Michael Egan said:

"AAPT's owner, Telecom NZ, is undertaking major capital investment in New Zealand (it's just announce national 3G network) and I can understand it wanting to focus on its home turf. However, its decision will not affect Terria's bid. We have an excellent business case and are more than confident of our ability to fund the new network...

"And...unlike Telstra, which also stated on Tuesday that it would take eight years to connect rural and regional areas, Terria will start its high speed broadband roll out in these neglected areas immediately upon award. We are committed to completing the nation-wide roll out in the five year time frame set by the Government."

Telstra meanwhile is calling for an abandonment of the RFP process and for the Government to give it the $4.7b and let it get on with the job immediately. "Telstra is ready to build a world-class, high-speed National Broadband Network. Let's get on with the job. Every day we delay in the current environment adds unnecessary costs and foregone benefits to the Australian economy."

Telstra has been pushing this line for months. If competition to build the NBN evaporates and it refuses to make any compromises with the Government to get an NBN build, its arguments are going to start wearing rather thin.