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Optus cries foul over Telstra's broadband proposal

Tracy Lee | Dec. 1, 2008
Optus (of which SingTel is the parent company) has called on the federal government to stick closely to the tender process for the A$4.7 billion national broadband network (NBN) project

SYDNEY, 1 DECEMBER 2008 - Optus (of which SingTel is the parent company) has called on the federal government to stick closely to the tender process for the A$4.7 billion national broadband network (NBN) project after the government said it might still consider the proposal from Telstra even though it failed to comply with the rules.

Communications Minister Stephen Conroy said yesterday that the expert panel charged with assessing the proposals for the NBN was taking legal advice on the status of the 12-page letter Telstra submitted as a scoping proposal last Wednesday.

"The role of the expert panel is to make that assessment," he told ABC Television on Sunday. "It will take legal advice."

Final submissions for the NBN were due last Wednesday and the possibility that Telstra's proposal could qualify as a formal bid has sparked debate over the fairness of the procedure.

"We are relying on the Australian government's undertakings in relation to the probity and viability of this process to secure the right outcome for Australians," Optus chief executive Paul O'Sullivan told The Australian Financial Review yesterday.

"No company or vested interest should be allowed to undermine this process. The events of last week only highlight the need for urgent and deep-rooted reform in the structure of the fixed-line telecommunications industry in Australia."

Mr O'Sullivan said Optus spent $5 million preparing its almost 1000-page proposal, which on top of the $5 million bond required to bid for the project takes the group's total investment to date to about $10 million.

"In addition, we have committed to a regulatory framework that would provide open access and structural separation of the network from any retail provider."

On Wednesday three organisations, Optus, Acacia and Axia Netmedia, submitted bids to build a national broadband network, while two proposals, one from Transact and one from the Tasmanian government, were targeting state-only roll-outs.

Senator Conroy has said that proposals should meet the government's objectives of providing a fibre-based network that will reach 98 per cent of the Australian population and deliver minimum speeds of 12 megabits per second (mbps).

Telstra has proposed a national broadband rollout but it has made clear that it is likely to be able to deliver coverage for only 90 per cent of the population, arguing that the $5 billion it is tipping in, on top of the government's $4.7 billion, allows only for that level of reach.

The other three national broadband bids have claimed they will meet the criteria to reach 98 per cent of the population but some, such as the Acacia bid, have proposed doing this by connecting the more remote areas with wireless technology rather than a fixed-fibre network.

 

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