Telstra excluded from national broadband network build

December 15th, 2008 by Daniel Young | Filed under Politics.

Senator Conroy has excluded Telstra from the NBN tender following the telcos non-compliant submission to the Federal government. Telstra didn’t include a proposal for the provision of services to SMEs until December 5 (more than a week after the deadline), which has been given as the reason for the exclusion.

Telstra’s chairman, Donald McGauchie has labelled the reasons for the exclusion as ‘trivial’.

Telstra’s initial proposal was an attempt to disrupt the process. I doubt they expect such a ballsy response from the Government.

Its possible that Telstra will somehow be invited back to the negotiating table. Some have argued that it’s in the national interest for Telstra to build the network or at least be considered alongside the competition.

The other bidders include Signtel Optus, Melbourne-based Acacia, Canadian group Axia, the Tasmanian Government and Canberra utility group TransAct.

The likely outcome of this development (apart from a major dip in Telstra’s share price).

First off, a media war whereby Telstra paints itself as the victim. The company runs the risk of generating considerable bad will if it is not able to do this and its engagement with and commitment to social media will be put to the test.

Second, delays to the process. Legal claims and counter-claims.

Third, Telstra going it alone by investing and building out its current cable, Next G (which doesn’t work in parts of Perth’s CBD) and DSL networks resulting in the eventual Government-sponsored NBN competing head to head with an obstructive and reactionary incumbent.

Fourth, enforced separation of Telstra’s wholesale and retail assets.

The net net result: A continued hiatus for Australia’s broadband network and the digital economy.

This country!