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iiNet to buy TransACT?

By 16 November 2011 28

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The Register is carrying speculation that TransACT is about to be bought by the generally excellent iiNet ISP:

Speculation that TransACT is for sale has popped up on a fairly regular basis as far back as 2004, and in 2009, but this time, the Australian Financial Review is reporting “final negotiations” from behind its paywall.

TransACT was an early entrant into infrastructure-based competition in Australia, building a fibre / VDSL network in Australia’s capital that was established in 2000. As well as its network operations, the carrier operates data centres in the ACT, and in 2008 acquired Victorian regional HFC network operator Neighborhood Cable.

Acquisition of TransACT would give iiNet more than just a residential network: over time, the company has also made its way into both state and federal government agencies. The Canberra company also claims 5,000 SME customers, a market that iiNet is increasingly targeting with new services.

UPDATE: Smart Company is reporting a trading halt on iiNet amidst speculation they’re about to announce the move:

Telco iiNet has been placed in a trading halt ahead of what is reported to be a move to acquire Canberra ISP TransACT.

The move comes after the Australian Financial Review this morning reported the company has been speaking with ISP TransACT and that negotiations were in a late stage.

Such a deal would see iiNet take control over some infrastructure elements including networks in Canberra and Victoria.

The move comes after iiNet has already bought out AAPT’s residential customer base earlier this year.

iiNet has requested a trading halt until Friday, or until it makes an announcement.

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28 Responses to iiNet to buy TransACT?
#1
mcs11:59 am, 16 Nov 11

As someone that has transact cable into my property, but not using it at the moment as it was ridiculously expensive compared to Iinet’s offering for Naked DSL, this sounds like a good deal to me , as long as it leads to lower pricing on the current Transact network.

#2
Grrrr12:06 pm, 16 Nov 11

Seems likely that iiNet is buying someone, because they just entered a trading halt:
http://www.asx.com.au/asx/research/companyInfo.do?by=asxCode&asxCode=iin

TransACT does a lot of business that iiNet doesn’t focus on, so if iiNet are buying them, it’ll be interesting to see what happens.

Personally, I’m hoping for a speedup of TransACT’s VDSL2 ugprade of their Phase1 network. At this stage, it’s going to take them about a year to complete. It’s the only way to get faster than ADSL2+ speeds for most people outside of the FTTH areas – 60/15mbps ahoy! (Telstra LTE 4G real world speeds will not compete, sorry.)

#3
aidan12:19 pm, 16 Nov 11

Interesting. I too had TransACT cable (phone) but didn’t bother with the broadband as it was ridiculously expensive. At the beginning of the year a rep came round and signed me up as they had a $5 broadband offer (plus $20 ISP fees).

I just assumed they were trying to get as many broadband customers on the books as possible for a possible NBN deal, but perhaps it was trying to make it look better for a takeover?

#4
Thoroughly Smashed12:26 pm, 16 Nov 11

I like the sound of that.

#5
deye12:27 pm, 16 Nov 11

could be interesting if they do.

#6
Rollersk8r12:56 pm, 16 Nov 11

As an iinet customer I’m very interested to see what they might offer!

Although, the TransACT cable up behind my house was lying slack on the ground for about a week. I rang ACTEW and got an automated message they were attending to matters already reported in my suburb. Someone obviously came – as the cable has now been raised to waist height… right along the track where people walk their dogs etc.

#7
Jivrashia1:14 pm, 16 Nov 11

I hope with this acquisition that things can only get better…

Yeah, my past experience with TransACT is something to sing about (tongue firmly in cheek).

#8
thatsnotme1:33 pm, 16 Nov 11

I assume if iiNet buy TransACT, that’d be the end of the TransACT bundling with ACTEW services as well?

Will certainly be interesting to see whether iiNet are willing to actually offer services at anything like modern speeds and prices. I just tried to check what speeds are actually available at my place via TransACT (I have VDSL cable available), and they don’t even deign to mention speeds on their website any more?? Even in the FAQ, the question ‘How fast is a TransACT VDSL OR VDSL2 broadband connection?’ leads to an entry that no longer exists…I assume they forgot to remove the question from the FAQ at the same time as they removed the answer. It’s rubbish like that which has always stopped me considering connecting to TransACT (not to mention the cost, and the number of stories I’ve heard of people counting down the days until they were out of their contract and could move to someone else!)

#9
Thoroughly Smashed1:55 pm, 16 Nov 11

thatsnotme said :

I assume if iiNet buy TransACT, that’d be the end of the TransACT bundling with ACTEW services as well?

Will certainly be interesting to see whether iiNet are willing to actually offer services at anything like modern speeds and prices. I just tried to check what speeds are actually available at my place via TransACT (I have VDSL cable available), and they don’t even deign to mention speeds on their website any more?? Even in the FAQ, the question ‘How fast is a TransACT VDSL OR VDSL2 broadband connection?’ leads to an entry that no longer exists…I assume they forgot to remove the question from the FAQ at the same time as they removed the answer. It’s rubbish like that which has always stopped me considering connecting to TransACT (not to mention the cost, and the number of stories I’ve heard of people counting down the days until they were out of their contract and could move to someone else!)

Their website has become almost entirely useless. In addition to that FAQ answer that neither of us could find, there are two data plans with the same amount of data but different prices. What’s the difference? Nobody knows!

#10
dvaey2:13 pm, 16 Nov 11

thatsnotme said :

It’s rubbish like that which has always stopped me considering connecting to TransACT (not to mention the cost, and the number of stories I’ve heard of people counting down the days until they were out of their contract and could move to someone else!)

Ill put my name down as one of those people. Ive been a TransACT customer since 2001 when they offered long-distance pre-selection to Telstra customers, then took up their cable offer once it became available. However, each time we made a small change to our setup (adding movie channels to the TV service, or changing network speed) they forced us onto a new contract. Our last contract has just run out, and we’re in the process of switching all our services from TransACT to other providers.

Our biggest problem, was that due to how our account was setup, we were still paying 2001 prices for poor services, so for 1mbit internet and basic pay tv service we were contracted to over $100 per month. (plus the ISP charges) Their service was great in the early 2000′s, but they never kept up with the market or with market pricing.

#11
the_snapper2:55 pm, 16 Nov 11

Talkative Ivan Slavich gums up on TransACT sale here: http://wp.me/p1sjY1-43U

#12
LadyBhaal3:00 pm, 16 Nov 11

I’m on TransACT’s VSDL2, and I love my 30/10 :) I don’t think I’ll get much better till the NBN gets here.

#13
mtrax3:50 pm, 16 Nov 11

what parts of TransACT will they be buying? ALL of it? or just the ISP part?

#14
thatsnotme4:18 pm, 16 Nov 11

mtrax said :

what parts of TransACT will they be buying? ALL of it? or just the ISP part?

Well by rights, TransACT isn’t an ISP – Grapevine is the ISP that does all the bundling with TransACT, but there’s been no mention of it being sold. But what iiNet are looking to buy is the TransACT network – ie, the infrastructure side.

#15
dungfungus4:50 pm, 16 Nov 11

This maybe is great news for ratepayers because we might get back the $80 million odd that Actew and their associate companies have written off investing in TransACT. Can the ACT Government then please legislate to stop them rushing off to blow our money into another crazy scheme?
S***! – I just remembered someone with strong Actew connections is looking for $30 million for an ampitheatre in the bush. Oh well, I guess we will have to settle for $50 million.

#16
alaninoz6:13 pm, 16 Nov 11

dungfungus said :

This maybe is great news for ratepayers because we might get back the $80 million odd that Actew and their associate companies have written off investing in TransACT. Can the ACT Government then please legislate to stop them rushing off to blow our money into another crazy scheme?
S***! – I just remembered someone with strong Actew connections is looking for $30 million for an ampitheatre in the bush. Oh well, I guess we will have to settle for $50 million.

Good joke dungfungus! The money has already been p****d up against a wall and will never be seen again. The $30M will come from another hand entering our pockets.

#17
echoztrip8:03 pm, 16 Nov 11

If iiNet assist in pushing out the VDSL2 roll out, up the speeds and provide better ISPs on the network, then it might actually make TransACT a worthwhile competitor towards the currently much better value ADSL2+ over good ole Telstra copper …

#18
Grrrr9:08 pm, 16 Nov 11

Thoroughly Smashed said :

there are two data plans with the same amount of data but different prices. What’s the difference? Nobody knows!

The more expensive plan has faster line rates. However, some idiot up top of TransACT decided that a recent ACCC ruling meant that they couldn’t advertise line rates anymore.

LadyBhaal said :

I’m on TransACT’s VSDL2, and I love my 30/10 :) I don’t think I’ll get much better till the NBN gets here.

Actually, the TalkWeb Supersonic VDSL2 plan has been revised – it’s 60/15 for $50/mo. It’s offered to everyone on the Phase1 network who’s getting upgraded from VDSL(1). You can probably get it if you phone up and demand it, whether you were on VDSL(1) or not.

thatsnotme said :

Grapevine is the ISP that does all the bundling with TransACT, but there’s been no mention of it being sold. But what iiNet are looking to buy is the TransACT network – ie, the infrastructure side.

There’s no official mention of TransACT being sold either – and TransACT has owned 100% of Grapevine for a little while now, so it seems reasonable to assume Grapevine is included in the sale.

#19
Deref9:24 pm, 16 Nov 11

I’ve been on TransACT ever since it arrived in my suburb. It wasn’t a bad deal initially, but they never moved on. It’s been generally reliable, but that’s the best I can say about it. This’ll probably be a good thing.

#20
sebrey9:32 pm, 16 Nov 11

I find this very hard to believe. As a long time iinet customer with work, and over the last 4 odd years through Transact broadband with iinet ISP, we have gone away from them, due to their unreliabilty and thieving over use charges. IINET were only able to supply a 40Gb/month connection, and as we went over this we would get a notice a week after the fact with a $1000 over use bill and service suspension without notice. When contacted, the money paid, their stupid system would run again for a few hours and disconnect again, due to a fault in their system not applying the payment. In a business that requires reliable internet connectivity this was not satisfactory.
IINET’s information when questioned regarding upping our bandwidth was that they were moving away from the Transact network and only supporting the bear minimum with existing clients.

For my sake I hope they don’t get to take over Transact.

#21
thatsnotme9:48 pm, 16 Nov 11

Grrrr said :

The more expensive plan has faster line rates. However, some idiot up top of TransACT decided that a recent ACCC ruling meant that they couldn’t advertise line rates anymore.

Ha, that’s got to be one of the most ridiculous things I’ve ever seen! However, this is TransACT we’re talking about, so I find myself believing that this is entirely possible. I don’t suppose you have a link to any info on the ACCC ruling? I’m curious as to what the ACCC could possibly have ruled on to lead to such a stupid decision.

I just find it extraordinary that any company would give potential customers the choice between two different packages (eg, if you just wanted phone and internet, you have the choice between ‘TalkWEB Zoom’ and ‘TalkWEB Rapid’), with absolutely zero explanation of what the difference between the packages is – aside from one being $10 a month more expensive. As far as I can see, the only place on the new website that these packages are mentioned, are in the drop down box where you make that choice. Seems kinda like heading to a restaurant, and getting a menu with ‘Option 1′ and ‘Option 2′ as the only text.

Grrrr said :

There’s no official mention of TransACT being sold either – and TransACT has owned 100% of Grapevine for a little while now, so it seems reasonable to assume Grapevine is included in the sale.

True, the talk of TransACT being sold to iiNet is speculation until an official announcement is made, but it seems like the pieces are all falling in place.

I didn’t realise that Grapevine was 100% owned by TransACT. Given that iiNet are a TransACT ISP, I guess they would just look to transfer all the Grapevine customers over to themselves, and kill off Grapevine as an ISP. It makes no sense to own two separate ISP’s on a network that you also own. It’ll be interesting to see whether iiNet, should they buy TransACT, then go and make iiNet the default choice for ISP, a-la Grapevine – their website almost makes it seem to be your only choice – or if they’re more interested in running it as an open network.

Whatever happens, I can only see the possibility that iiNet purchases TransACT as a positive thing. They can’t possibly make a bigger hash of things than TransACT have for the past 10 years or so!

#22
thatsnotme10:05 pm, 16 Nov 11

sebrey said :

I find this very hard to believe. As a long time iinet customer with work, and over the last 4 odd years through Transact broadband with iinet ISP, we have gone away from them, due to their unreliabilty and thieving over use charges. IINET were only able to supply a 40Gb/month connection, and as we went over this we would get a notice a week after the fact with a $1000 over use bill and service suspension without notice. When contacted, the money paid, their stupid system would run again for a few hours and disconnect again, due to a fault in their system not applying the payment. In a business that requires reliable internet connectivity this was not satisfactory.
IINET’s information when questioned regarding upping our bandwidth was that they were moving away from the Transact network and only supporting the bear minimum with existing clients.

For my sake I hope they don’t get to take over Transact.

My question is why, with a business that requires reliable internet connectivity, this situation was allowed to go on for 4 years? Surely issues like this would have caused you to investigate alternatives that were more reliable and met your business needs?

Is it not also possible, that the cause of some of these issues, could be the relationship between TransACT (who, it seems, are also an ISP under a different name) and the ISP, and that iiNet may have been having difficulty with this relationship? The fact that they have mentioned withdrawing from their relationship with TransACT, and not expanding their services through them, seems to suggest that they just couldn’t operate their business properly through the TransACT network.

That’s something I’d believe, too. I’m an Internode customer, on an ADSL2+ connection, and I’ve seen the question asked on Whirlpool in the past – ‘why aren’t Internode a TransACT ISP?’ It seems that TransACT just weren’t interested in them providing services on their network, and eventually Internode just gave up – not surprising really, given the size of the Canberra market.

The sooner TransACT is run by a mob with half a clue, the better we’ll be. Until it’s sold off to the NBN at least (if they even want it).

#23
Chop7110:04 am, 17 Nov 11

dungfungus said :

This maybe is great news for ratepayers because we might get back the $80 million odd that Actew and their associate companies have written off investing in TransACT. Can the ACT Government then please legislate to stop them rushing off to blow our money into another crazy scheme?
S***! – I just remembered someone with strong Actew connections is looking for $30 million for an ampitheatre in the bush. Oh well, I guess we will have to settle for $50 million.

Ecowise, Ecowise VIC and Grapevine, god bless your cotton socks ACTEW

No wonder their books are no longer available to the public.

#24
schmeah10:48 am, 17 Nov 11

great, so I just signed up for bundling services and spent all day yesterday trying to get onto Grapevine to assist with setting up my account .. and all my phone calls and emails went unanswered despite how long I waited on the phone.

#25
dungfungus10:57 am, 17 Nov 11

schmeah said :

great, so I just signed up for bundling services and spent all day yesterday trying to get onto Grapevine to assist with setting up my account .. and all my phone calls and emails went unanswered despite how long I waited on the phone.

Do you think they are trying to tell you something?

#26
Grail1:15 pm, 17 Nov 11

dungfungus said :

This maybe is great news for ratepayers because we might get back the $80 million odd that Actew and their associate companies have written off investing in TransACT.

There are a lot of investors out there who don’t understand the difference between “real estate” and “infrastructure”. You don’t make a profit trading infrastructure: the whole point is that you write off that capital expenditure with the aim of making a profit on the services provided: this is almost exactly the opposite of real estate where you rent the place out in the short term to offset your losses, with the aim being to make money from selling the property once its value has increased.

#27
Grrrr1:46 pm, 17 Nov 11

thatsnotme said :

My question is why, with a business that requires reliable internet connectivity, this situation was allowed to go on for 4 years? Surely issues like this would have caused you to investigate alternatives that were more reliable and met your business needs?

Is it not also possible, that the cause of some of these issues, could be the relationship between TransACT (who, it seems, are also an ISP under a different name) and the ISP, and that iiNet may have been having difficulty with this relationship? The fact that they have mentioned withdrawing from their relationship with TransACT, and not expanding their services through them, seems to suggest that they just couldn’t operate their business properly through the TransACT network.

That’s something I’d believe, too. I’m an Internode customer, on an ADSL2+ connection, and I’ve seen the question asked on Whirlpool in the past – ‘why aren’t Internode a TransACT ISP?’ It seems that TransACT just weren’t interested in them providing services on their network, and eventually Internode just gave up – not surprising really, given the size of the Canberra market.

The sooner TransACT is run by a mob with half a clue, the better we’ll be. Until it’s sold off to the NBN at least (if they even want it).

This. All of it.

Internode didn’t become a TransACT ISP mostly because they want Layer 2 connectivity (as is typical of any resold broadband service) and TransACT only provide Layer 3.

iiNet were not interested in ramping up their TransACT operations probably because it’s a lot cheaper for them to have a customer on their own port (iiNet DSLAMs) than on a TransACT port. L2/L3 night have been part of it, too.

#28
dungfungus3:27 pm, 17 Nov 11

Grail said :

dungfungus said :

This maybe is great news for ratepayers because we might get back the $80 million odd that Actew and their associate companies have written off investing in TransACT.

There are a lot of investors out there who don’t understand the difference between “real estate” and “infrastructure”. You don’t make a profit trading infrastructure: the whole point is that you write off that capital expenditure with the aim of making a profit on the services provided: this is almost exactly the opposite of real estate where you rent the place out in the short term to offset your losses, with the aim being to make money from selling the property once its value has increased.

Your point regarding Actew blowing our $80 million is?

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