Clash of the 500lb gorillas pt 2

harvyk1 15 December 2008 34

For all who didn’t read pt 1 of the thread see below

It appears that Telstra are potentially going to be making trouble now it’s been excluded from the tender process because surprise surprise, it’s tender response was not up-to scratch.

News have the story.

Why is this important to note in a place like Canberra? Well I expect a good percentage of people working in Canberra would have at some point in time worked on a project which went out to tender. It’s nice to know that the process in place has worked, and that a company can not come in and simply throw it’s weight around and expect to get something.

Maybe us small guys are still in with a chance in this town.

It’ll be interesting times ahead as Telstra no doubt now go to the courts.

Also does anyone know if TransACT has a preference of which other company they will be working with?

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34 Responses to Clash of the 500lb gorillas pt 2
dexi dexi 8:24 pm 16 Dec 08

Time Sol went home. He personnaly has made the biggest profit in the comms industry for himself. Procedure be damned, just keep the bonuses rolling.

harvyk1 harvyk1 4:31 pm 16 Dec 08

“Gee, this is a surprise” (It’s difficult to write in a monotone voice),27574,24807123-15306,00.html

So Telstra is readying the laywers.

Stage 1 – Put in cheap ass response (Check)
Stage 2 – Get lawyers involved (Check)
Stage 3 – Wrap up the NBN in courts until the gov’t gives in (In progress)
Stage 4 – Gov’t gives in – Profit for Telstra

dalryk dalryk 1:17 pm 16 Dec 08

Telstra assumes no other bidder has made a commitment as they have not made any public announcements on the subject. Continuous disclosure requirements for listed companies mean you have to disclose any information that may have a material effect on your share price, like investing $5 billion in network infrastructure. No other bidder has made such an announcement, ergo, no other bidder has the money available to commit and will have to seek financing of some sort.

That’s the story anyway. Could be just more management bulldust.

Personally I think that Sol’s strategy would have been brilliant in the US, but Australia works differently. Both sides have now backed themselves into a corner with their unrelenting brinksmanship, and in the end we’re the losers. Yes Telstra’s response was arrogant and stupid, but that said, cheering the triumph of ridiculous process over any chance of a decent outcome is the sort of stupidity only public servants can support.

harvyk1 harvyk1 1:14 pm 16 Dec 08

Jim Jones said :

WTF is ‘enept’?

Sorry, my bad, I meant Inept.

la mente torbida la mente torbida 1:06 pm 16 Dec 08

I know, nationalise telstra then flog it off to the successful tenderer

astrojax astrojax 12:43 pm 16 Dec 08

yebbut, s4anta, telstra claimed they were the only ones kicking in a substantial dollar figure themselves – irrespective of the gov’t co-funding, if this process is fair dinkum, how would telstra know what other bidders have promised to stump up?

i agree, telstra will be back in the game, at some point, but mebbe sans sol…

i still wanna know about ‘blane’ – intriguing as enept…

peterh peterh 12:16 pm 16 Dec 08

Jim Jones said :

WTF is ‘enept’?

bad spelling?

telstra can sit back and wait. they can afford to. If the winning consortia comes up to telstra later on for connection to the network, they will pay.

Jim Jones Jim Jones 10:30 am 16 Dec 08

WTF is ‘enept’?

harvyk1 harvyk1 10:26 am 16 Dec 08

Listening to the radio, I believe Telstra is planning on making it very difficult for the successful bidder to gain access to the existing (and once publically owned) cables.

Sadly Telstra knew that because the previous enept gov’t sold Telstra inc infrastructure that they now can non-comply as much as they like, they own the infrastructure.

BTW It’s not only the previous gov’t I think are enept at IT stuff, hell I don’t think we have ever had a minister for IT who actually knew what they where doing.

VicePope VicePope 10:03 am 16 Dec 08

I heard some of the Telstra hissy fit yesterday. Pathetic. If one has ever dealt with a government tender, rule 1 is that you read the request and include everything you have to include. If you don’t, you will almost certainly be excluded. It doesn’t matter if you’re really big, and really skilled, or even if you can do it at great price. If it’s mandatory that the bid be submitted on bright pink paper and that it discuss the effect on aircraft noise around public toilets, do it. Because doing the tender right shows that you’re careful – and people tend to prefer to pay serious money to those who take a careful approach – and that you respect your customer (even if it’s the government).

Telstra fell down somewhere here. If the shareholders want to get even, they shold get even with the board. If the board wants to get even, it should get even with the highly paid execs who decided a derisory expression of interest was good enough. If the government had allowed this budgie to fly with the eagles, it would have opened itself up to serious and credible challenges from everyone else involved.

S4anta S4anta 9:50 am 16 Dec 08

tylersmayhem said :

Either way, I reckon Telstra will have their own high-speed broadband product up and running well before the 5 odd year project timeline draws to a close.

…and how many zeros behind the $ would you like with your happy meal?!

I’ll have my cheeseburger filter free please!

S4anta S4anta 9:49 am 16 Dec 08

astrojax said :

Telstra claim that they are the only company to have submitted a proposal with a real financial commitment – of $5 billion.

i thought tender processes are confidential. how would they know??

as for the news story’s headline, what is a ‘blane’?

The tender documents states that the govt would kick in $4.7bn for the project.

Roma Roma 8:50 am 16 Dec 08

This is all a sham. Telstra will probably be courted by the government at some point. Soon. I think this was just a ‘wrap on the knuckles’ effort by the government, knowing full-well that they will seek a better offer, or another form of ongoing support, from Telstra in the future. Trust.

johnny_the_knife johnny_the_knife 8:30 am 16 Dec 08

I’ve said it before, but I firmly believe the reality is that the privatisation of Telstra without functional separation has done nothing but harm to telecommunications in this country. The installation of RIM devices in new developments is a good example, as is Telstra’s attempt a couple of years ago to sell wholesale ADSL services at a higher price than its own retail prices for the same services, not to mention the placing of artificial restrictions on bandwidth available on the ADSL1 service for many years. As a publicly listed entity, Telstra is obliged to do what it thinks is best for its shareholders, that’s not necessarily congruent with the best interests of the Australian telecommunications user.

I’m personally stunned this government seems to have grown a set of balls and stood up to Sol and his cronies on the Telstra board of directors. Having said that, it will be interesting to see what will happen when the successful bidder needs to access Telstra’s infrastructure to complete the network. I can’t see anybody being able to implement a NBN at a reasonable cost without accessing the existing infrastructure.

Further to the above, since Telstra’s share price dropped some 12% yesterday to a two year low on the back of this news, I wonder if the Shareholders will decide to hold the board to account sack Sol (the second worst thing to happen to telecommunications in the country)?

Primal Primal 8:51 pm 15 Dec 08

peterh said :

The NBN is all well and good, but how will it impact canberrans? not much. we have telstra, we have transact, we have soul, we have optus, etc, etc.

I think the many Gungahlites who are stuck with ADSL1 because Telstra installed RIMs all over their end of town instead of a decent spread of exchanges would be hoping for something better in years to come.

astrojax astrojax 4:56 pm 15 Dec 08

Telstra claim that they are the only company to have submitted a proposal with a real financial commitment – of $5 billion.

i thought tender processes are confidential. how would they know??

as for the news story’s headline, what is a ‘blane’?

tylersmayhem tylersmayhem 4:43 pm 15 Dec 08

Or hopefully soon to be lack there of! 🙂

tylersmayhem tylersmayhem 4:43 pm 15 Dec 08

Yep – monopoly indeed Poptop!

poptop poptop 4:41 pm 15 Dec 08

Ah! So Telstra is just playing spoilers, then? Won’t bid fair and square and will try to stop anyone else getting into the space.

I’m sure you’re right about who contacted the media.

harvyk1 harvyk1 4:32 pm 15 Dec 08

poptop, the problem is that Telstra will now probably take the issue to court. They will no doubt put a holt to the NBN until the court has decided if the reasons Telstra was excluded where valid ones. Think GDE, except over all OZ.

Also I believe it was Telstra who contacted the media to say that their bid was rejected, not the gov’t.

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