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Thursday, 24 June 2010 20:22

NBN-Alcatel deal: Big news gets buried


If either the NBN Company or Alcatel-Lucent were looking to make a splash with the news that the French telecommunications equipment provider had won a contract worth $70 million for the initial supply of network electronics, they sure picked a bad day.

Or a very good one, depending on what you're trying to achieve. And what would normally be a good news technology story for both sides of this deal - and a three-way if you include the joy that first contracts would deliver to the Minister's office - has been buried.

Clearly nothing stinks about this deal at all. But it is very, very sensitive.

And it is certainly unusual. The $70 million contract is just a starter. Presumably it is one of those deals that companies enter in order to get to know each other's products, services and capabilities. It means Alcatel-Lucent is officially an "initial strategic supplier."

NBN Company openly acknowledges that it will spend about $1.5 billion on the Gigabit Passive Optical Network (GPON) and Ethernet Aggregation equipment it has just signed for with Alcatel-Lucent.

What's odd is that NBN Co's chief executive Mike Quigley and it's chief financial officer Jean-Pascal Beaufret were previously COO and CFO respectively of Alcatel-Lucent worldwide.

There is nothing secret about this. And there is no suggestion of wrong-doing. So why make the announcement on a taking out the trash day (in West Wing parlance?)

They know the people, the products and the capabilities of Alcatel-Lucent intimately. So why the tiny fixed price contract? Could it be that this was being run up the flagpole to see how many people started shooting at it?

And why isn't the Minister celebrating the milestone, as he has made a habit of doing?

NBN Co's head of corporate services Kevin Brown says Quigley and Beaufret did not participate in the "executive committee" that selected Alcatel-Lucent. And they had nothing to do with the negotiation of price, and they stepped out of the board when it was time to vote etc etc etc.

All that transparency and accountability and good stuff like that is well and good. So again, why take it out with the trash?

But if you believed the core of that statement, I'd suggest you'd also believe that the $550,000-a-year hiring of Mike Kaiser as the NBN Co's government relations chief had nothing to do with Stephen Conroy or the fact that the Minister had suggested Kaiser to Quigley.

And it didn't. Just ask either Mike Quigley or Stephen Conroy.


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