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Telstra Kicked Out of $15bn Broadband Project

timothy posted more than 5 years ago | from the yeah-but-those-are-australian-dollars dept.

The Internet 158

An anonymous reader writes "Australia's largest telco and ISP, Telstra, has been kicked out of the bidding process to build a national broadband network (NBN) estimated to be worth $15 billion. The Aussie government had earlier given assurances that the proposal would be considered, however it now won't even be evaluated by the expert panel, which will make the recommendations to the Senator for Broadband and Communications. The government may now take steps to legislate so that Telstra can't build a network that competes with the NBN — leaving the incumbent to focus on wireless HSPA+ technology instead."

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158 comments

What about competition? (1, Insightful)

MichaelSmith (789609) | more than 5 years ago | (#26116917)

I hate Telstra as much as everybody else in this country but it seems to me that eliminating the biggest telecommunications carrier will reduce competition and push up prices.

At the very least it would be difficult for whoever wins the bid to not work with Telstra at some point, because of the amount of infrastructure they control.

Re:What about competition? (4, Insightful)

Max Littlemore (1001285) | more than 5 years ago | (#26117029)

You say eliminating the biggest provider will reduce competition? Eliminating a virtual monopoly is bad for competition? Wow.

I think it's a bit silly not even reviewing their proposal, but that's ridiculous.

Re:What about competition? (-1, Troll)

Anonymous Coward | more than 5 years ago | (#26117051)

Dick cheese

Re:What about competition? (-1, Offtopic)

Anonymous Coward | more than 5 years ago | (#26117497)

well pull your foreskin back and wash your knob. You wonder why you never get blowjobs, thats why.

Re:What about competition? (4, Informative)

mgblst (80109) | more than 5 years ago | (#26117835)

Their proposal was 12 pages long, compared to serious proposals of hundreds of pages. Telstra were threatening not to bid at all, unless the government gave them some guarantees that no matter who won, they would be involved in the projects.

Telstra were pushing themselves, and the government called their bluff. They have been punished in the markets, dropping 12%, and they should be punished by the government as well.

Re:What about competition? (3, Informative)

Anonymous Coward | more than 5 years ago | (#26117867)

I don't think Telstra wanted to win. They had to put in a bid for sake of appearances, and reports are that what they put in was gratuitously half-arsed. I doubt they plan to play this game by the rules. Perhaps winning would have been quite inconvenient for them.

Recall that a FTN tender was already called, bid, won and accepted, but that Telstra managed to get it canceled, and the process restarted. Maybe they hope to do so again. In truth they haven't been seriously considered, and if they can manage to prevent their own recalcitrance and mistakes being raised in court, which maybe they can if the Law is, as so often is said, an ass, then they will get another bite at the cherry. Third-time could be the charm; the Government might well give up on the idea.

It's not obvious what else they could gain by this, unless it's merely a few more months to a year to exploit their final piece of monopoly infrastructure; the local loop. FTN will shrink that monopoly from copper runs of thousands of meters length to perhaps one-hundred meters. Whatever price they presently justify for the local loop surely will be reduced by a factor of 10 to 50 after FTN is deployed.

I've heard that the local loop represents 60% or more of the total capital value of Telstra, from which I conclude that (an opposition owned) FTN will reduce their value by over 55%.

Note to self: ob Telstra shares: sell! sell! sell!

-- Newall

Re:What about competition? (1)

gronofer (838299) | more than 5 years ago | (#26117869)

You say eliminating the biggest provider will reduce competition? Eliminating a virtual monopoly is bad for competition? Wow.

I think it's a bit silly not even reviewing their proposal, but that's ridiculous.

Apparently it won't be possible to build this new network profitably unless it's given a government granted monopoly. So there is a high-stakes game being played to find out whether there will be a Telstra monopoly or a non-Telstra monopoly. Or alternatively the Labor government could back out of its election promise somehow.

Re:What about competition? (1)

sortius_nod (1080919) | more than 5 years ago | (#26118443)

Actually, if you know why they didn't even get to the review process you'd not think it so stupid.

Conroy has stated that Telstra basically wanted top level negotiations to start before the tender was even in place, and to do things the way Telstra wants, not the way the government process is. In essence it was a way for them to bypass the tender process and just get the deal.

I say tough shit Telstra.

Re:What about competition? (5, Interesting)

dbIII (701233) | more than 5 years ago | (#26117063)

They wanted to prove that they were not bound by the same rules as everyone else by not putting in a bid but expecting to be chosen anyway. If that had happened they would get to dictate their own terms. No government with even half of a clue would let this happen. The previous government dealt with it by pretending that it was not their problem even when they owned all and then most of Telstra. The current government still owns a lot of it (future fund) but their is some weird arrangement where they are not allowed to vote as if they are a shareholder left over from the previous government.

For those outside Australia Telstra can best be summed up as a combination of some of the worst aspects of the government organisation which it was and the worst aspects of a private telecommunications monopoly that it has become. Add to that a fully imported management team of executative with spectacular failures behind them of the sort that think slavery is a good idea and experise in anything is for the peasants. One was infamous for repeatedly refering to the remaining Australian management and the Australian staff as "savages".

If it wasn't close to a monopoly it would have gone the way of Enron long ago due to being run the same way.

Re:What about competition? (4, Interesting)

tux0r (604835) | more than 5 years ago | (#26117081)

I beg to differ.

Consider that the competitor may (yeah, I know, work with me) be able to provide a tender for a FTTH solution, as opposed to the rather short-sighted FTTN solutions bandied about. (Axia has been talking about [news.com.au] FTTH for their bid.)

Suddenly there's no issue with Telstra - the whole legacy copper network is leapfrogged. Competition on pricing and/or quotas rages. Australia is future-proofed and Telstra has to come up with another (distinguishable) technology to stay in the game.

I realise this is not an overnight solution, but we should all be thinking further than ten years into the future. I am very hopeful that FTTH becomes a reality with the new Australian NBN, and now that Telstra is out, it's just that little bit more likely...

Re:What about competition? (2, Insightful)

macraig (621737) | more than 5 years ago | (#26117251)

At the very least it would be difficult for whoever wins the bid to not work with Telstra at some point, because of the amount of infrastructure they control.

So... how about forcing them to sell it back to the People for whom they built it? It's common shared infrastructure, like roads, after all. It will be ridiculously costly, but leaving it in their control will mean that you'll all pay for it time and time and time again. This is exactly the same advice I had for our own Public Utilities Commission; I hope you don't (continue to) repeat every bloody mistake we've made! We had Bush, you had Mini-Me Bush John Howard....

Re:What about competition? (1)

ChodeMaster (773739) | more than 5 years ago | (#26117773)

We actually had Howard for a few years before Bush showed up on the scene. John Howard was Prime Minister from 1996.

Re:What about competition? (1)

ivucica (1001089) | more than 5 years ago | (#26117887)

Hah -- similar thing in Croatia. Sold national telco to Deutsche Telecom (T-Com, y'know). Now (almost) all our telco infrastructure is in foreign hands.

T-Com claims "DTK je u naÅem vlasniÅtvu!" - "Distribution Telecom Channels are our property!" and it's true since the government sold it along with Croatian Telecom, shortsighted and obviously not prepared for the consequences it'll have on free market.

Re:What about competition? (1)

Spadgos (962016) | more than 5 years ago | (#26117331)

I think the exact opposite! Awarding this massive project to someone OTHER than Telstra who already have a monopoly (with their existing infrastructure), will force both parties to compete for customers. This is a win for the little people! (Unless you're a shareholder, but you'd be used to losing by now, right?)

Re:What about competition? (1)

asifyoucare (302582) | more than 5 years ago | (#26117423)

Who to root for? I hate both Telstra and Conroy.

I favor mutual assured destruction.

P.S. I am Michael Smith also.

Re:What about competition? (1)

MichaelSmith (789609) | more than 5 years ago | (#26117491)

P.S. I am Michael Smith also.

I was once a member of the Michael Smith webring. Years ago when I worked for Vic Roads another Michael Smith was in management in a different department. He kept applying for these management stream courses but because I was first in a list somewhere (and the incompetence of HR) I kept getting the paperwork and turning up. I was a comp. sci. grad at the time so I was totally out of my depth. Eventually they sent both of us along and we got to exchange email addresses.

Re:What about competition? (2, Interesting)

whichpaul (733708) | more than 5 years ago | (#26117453)

5 - Insightful, what? Try logic-defying.

Firstly, Telstra is a formerly state owned monopoly (or at very least oligopoly) in the Australian telecommunications industry. Introducing another player into the scene will result in competition, NOT the opposite.

Secondly, this has nothing to do with the successful disavowing future interaction with Telstra, rather only placing limits on how Telstra can compete with the successful bidder.

This post really needs to be re-modded as the logic in it's argument is obviously flawed.

Re:What about competition? (1)

Amargosa3000 (931380) | more than 5 years ago | (#26117531)

They own the infrastructure, so its going to be great fun to see what happens. One bidder, Acacia, freely acknowledges that they will need to compensate Telstra for each copper line they take.

Re:What about competition? (1)

mgblst (80109) | more than 5 years ago | (#26117823)

Really? So getting a completely new company to build infrastructure to compete with the existing broadband lines owned by telstra will somehow magically decrease competition? I think you need to go read a dictionary sometime.

This is the best news. The only thing better would be if the government broke up Telstra into its Retail and Infrastructure business, allowing other companies to fairly compete.

Telstra is a joke, run by incompetents who shouldn't be allowed to touch a computer, let alone decide Australias future.

hey Telstra... (0)

Anonymous Coward | more than 5 years ago | (#26116927)

Now's Good.

ha.

Senator Conroy's handiwork (1, Insightful)

StrahdVZ (1027852) | more than 5 years ago | (#26116933)

Now I am one of the last people to defend Telstra, but this smacks of Conroy's handiwork.

1) Telstra refuses to participate in "live" trials of Conroy's much-maligned internet filter.
2) Telstra denied chance to bid for national broadband network based on a technicality.

Coincidence? I hardly think so.

Re:Senator Conroy's handiwork (0)

Anonymous Coward | more than 5 years ago | (#26116963)

Hmmm. A
No. Telstra trying to hold us all to ransom is the problem. For some reason they seem to think they should be given special treatment.

I don't care if it causes me a little pain. I don't give in to bullies.

Re:Senator Conroy's handiwork (5, Interesting)

Anonymous Coward | more than 5 years ago | (#26116975)

Plenty of other ISP's have refused to participate. ISP's who have like iiNet have publically bagged the entire process.

I think you are really reaching if you think the two are related.

Re:Senator Conroy's handiwork (0)

Anonymous Coward | more than 5 years ago | (#26117419)

And what happened to iinet?

Oh, that's right... [google.com.au]

There's a very common theme when it comes to those openly criticising Conroy. Also evident here [smh.com.au]

Re:Senator Conroy's handiwork (1)

ChodeMaster (773739) | more than 5 years ago | (#26117807)

I'm not trying to defend Conroy or anything here (I dislike him, his policies and the way he acts politically as much as any sensible Australian nerd with a love of uncensored internet), but are you actually trying to imply that Conroy had something to do with iinet being sued by film companies? p

Re:Senator Conroy's handiwork (1)

Chuck Chunder (21021) | more than 5 years ago | (#26117015)

I think a causal link there is probably a bit of a stretch.

That said it's a convenient distraction from the backlash Conroy has been facing and it must be hard for a lot of Australian internet users to decide who they dislike more, Conroy or Telstra.

Re:Senator Conroy's handiwork (2, Insightful)

mcon147 (960793) | more than 5 years ago | (#26117031)

Coincidence? .. hell yes. Conroy didn't need Telstra in the trials. He just needed a single isp, there's more than one in Australia. Rudd does need Telstra to build the network, Telstra knows the other carriers cant get credit to actually build the damn thing without the government backing it. Telstra knows the other carriers are there so it looks like there was a fair try, at not giving all the business to the dominant player. This isn't Conroy being stupid or evil, this is Telstra toying with him (You could argue he deserves it though).

Re:Senator Conroy's handiwork (1)

tux0r (604835) | more than 5 years ago | (#26117109)

...Telstra knows the other carriers cant get credit to actually build the damn thing without the government backing it.

I have a suggestion: how about we get the government to undertake a RFP process, so that the successful tenderer could take advantage of $4.7bn of government backing.

Oh, right...

Re:Senator Conroy's handiwork (2, Insightful)

mcon147 (960793) | more than 5 years ago | (#26117209)

The network wont be fully funded by the government. Hence the carriers are taking on some risk aswell.

Re:Senator Conroy's handiwork (5, Insightful)

dbIII (701233) | more than 5 years ago | (#26117083)

No. Sol has been playing politics on this broadband plan from the start. The trick to win the bid without putting in a proper bid would let him set his own terms.

Re:Senator Conroy's handiwork (3, Interesting)

Nefarious Wheel (628136) | more than 5 years ago | (#26117335)

... Sol has been playing politics on this broadband plan from the start. The trick to win the bid without putting in a proper bid would let him set his own terms.

Aye.

Sol, we've given you every break. We've bent over backwards to give you a chance. What we don't want to do at this point is grab our ankles.

The esteemed Mr. Trujillo is of the "everything's negotiable when you're this big" school. I think, personally, that he has mis-read the Australian psyche.

Re:Senator Conroy's handiwork (1)

aarggh (806617) | more than 5 years ago | (#26118227)

Although I think Senator Conroy is an ignoramus of the highest order, full kudos to the government for not bending the rules just because Telstra wants it. Telstra has always done it's absolute best to stifle any form of innovation that doesn't generate obscene amounts of money ONLY for Telstra, all the while p*ssing on our backs and telling us it's raining. I live in a 60-80 year old suburb 20 mins from the city and my home is 4.6k's from the exchange! It took me 5 years when we moved to get DSL. No equipment was changed or upgraded, Telstra simply downgraded the test requirements so my home JUST fell into a supported speed and reliability range. I still have to have a Telstra phoneline just so I can have DSL provided by another company.

There are any number of very capable providers out there who can step up to the plate, and provide a service without the crap you have to put up with Telstra. It's about time Sol got told where to go!

Re:Senator Conroy's handiwork (0)

Anonymous Coward | more than 5 years ago | (#26117671)

Whats the sun got to do with this?

Re:Senator Conroy's handiwork (5, Interesting)

mister_tim (653773) | more than 5 years ago | (#26117111)

Or rather:

3) Telstra submitted a non-conforming tender and the Government had no choice but to reject it.

Being a Government employee myself, when it comes to tendering you have to apply the same rules to everyone. If the Government had accepted Telstra's tender, even though it did not comply with the requirements in the RFT (and this was well publicised [news.com.au] , they would have left themselves open for all sorts of problems, e.g. being sued by other applicants.

Optus was right to say that Telstra's submission was a joke: a 12 page letter to the Minister in lieu of a serious tender for a $4.7bn project is brinkmanship of the worst sort and the Government was right to call their bluff.

Re:Senator Conroy's handiwork (3, Informative)

Whiteox (919863) | more than 5 years ago | (#26118119)

I'll quote this from ABC earlier on as it shows a different tack:

Prime Minister Kevin Rudd says the decision to exclude Telstra from bidding to build the national broadband network was made at arm's length from the Federal Government.
Telstra submitted a brief proposal instead of a full bid because it was not satisfied there was enough detail from the Government on regulatory requirements.
Telstra says it has been excluded because it did not say how it would include small and medium businesses in the network's construction.
The telco has accused the Government of using a peripheral issue to block it from winning the tender.

But Mr Rudd has said the decision was made by an independent panel assessing all of the bids and the project is still on track.

"We've regarded this as a necessary investment in the nation's infrastructure and we would do so on the basis of a competitive tender process," he said.
"That panel that's been at work has been full at arm's length from Government and has reached its own conclusions.

*snip*

Still optimistic
However Telstra remains hopeful it still has a chance to build the national broadband network despite being excluded from formal consideration.
A media analyst from stockbroker BBY, Mark McDonnell, has told ABC Radio's The World Today the exclusion is a dramatic development for the telco.
"It potentially spells the end of Telstra's aspirations for re-eingineering its network to provide high-speed broadband," he said.
But in a briefing with analysts, Telstra chief executive Sol Trujillo has argued it is not the end of the road for the company.
He says the Government may decide to reengage with Telstra if the other three national bids are inadequate.
Mr McDonnell says there could be more to the Government's decision than has been publicly disclosed.
"The question then is whether this is really part of some sort of gaming process, trying to soften up Telstra with a plan to ultimately reengage with them," he said.
"That is probably the most optimistic view you could take from a Telstra perspective on this, or in fact whether there is some other agenda."
Telstra shares have fallen more than 7 per cent in an overall strong day for the market.

This was earlier on and has fallen out of the RSS feeds.
http://www.abc.net.au/news/stories/2008/12/15/2446644.htm [abc.net.au]

Re:Senator Conroy's handiwork (4, Informative)

Ralish (775196) | more than 5 years ago | (#26117337)

I loathe Conroy, and everything national internet filtering involves, but in this case, it's more than just a technicality.

Whereas all the other major contenders submitted official proposals in the tender process, Telstra instead submitted an "informal" proposal that lacked significant details that the other official proposals had, not to mention vague estimations on things as minor as "network coverage". Further, many of these estimations fell far short of the government requirements in the first place. Add in the fact that Telstra wanted their flawed and half-baked proposal to be considered with the same standing as the detailed official tenders their rivals had submitted, and you being to realise that Telstra is just a joke.

Today it emerged that they didn't submit details on how they intended to liase with and include small business in the construction and development process; which is oh-so-fitting keeping in mind this is a giant telecom monopoly.

These articles better explain how absurd Telstra's position and conduct regarding the tender process has been to date. I challenge you to read them and not agree that they should have been kicked out of the evaluation process. Frankly, I'd have kicked them out some time ago.

Telstra bends the rules on internet bid [smh.com.au]

Telstra excluded from broadband network tender [abc.net.au]

Re:Senator Conroy's handiwork (3, Insightful)

TapeCutter (624760) | more than 5 years ago | (#26117357)

"Senator Conroy's handiwork?" - I wish politics was that simple...

1) Conroy rarely comments on the filter because he does not support it. The only reason a filter is being "trialed" is to placate senator Fielding from the "Family First" party who under certain circumstances can hold the balance of power in the senate. (ie: the govt of the day is buying his vote by spending ~$100K on his pet project). It's political theater that most people expect to see die in the senate (including Telstra, who called it a 'pipedream'). One of the IPS's who is taking part in the trial is iiNet who's CEO wanted to take part in order to "prove it was unworkable".

2) The NBN has been in the works longer than Conroy has been in his position. When Telstra leaned it was not going to be handed the contract on a silver platter they very publicly refused to play by the rules of the tender. Personally I applaud both our current and previous governments for refusing to bend over for a large corporation.

How does a religious nutter like fielding get elected in the first place? - Culled from wikipedia: "In Victoria, Family First, the Christian Democrats and the DLP allocated their senate preferences to Labor, in order to help ensure the re-election of the number three Labor Senate candidate, Jacinta Collins, a Catholic who has conservative views on some social issues such as abortion. In exchange, Labor gave its Senate preferences in Victoria to Family First ahead of the Greens, expecting Family First to be eliminated before these preferences were distributed. In the event, however, Labor and Democrat preferences helped Family First's Steve Fielding beat the Green's David Risstrom to win the last Victorian Senate seat and become Family First's first Federal parliamentarian."

In otherwords Fielding was a pawn that nobody expected to win, let alone hold the balance of power! Now that he does, both sides of the house come knocking on his door in an attempt to sway his vote.

Re:Senator Conroy's handiwork (1)

Malekin (1079147) | more than 5 years ago | (#26118229)

Conroy rarely comments on the filter because he does not support it.

You've stated this a number of times but I don't buy it. He may be Labor, but he's right wing and socially conservative. He's a headkicker - a politician who is in it for the politics and not to represent the will of his electorate. He's so religious he earned himself the nickname "the altar boy."

The policy for the mandatory clean feed was written and put in place after he was given the portfolio. Everything I've seen points What evidence do you have to support your claim?

Re:Senator Conroy's handiwork (1)

Malekin (1079147) | more than 5 years ago | (#26118247)

Everything I've seen points What evidence do you have to support your claim?

*Everything I've seen points to him personally supporting this policy.

Re:Senator Conroy's handiwork (0)

Anonymous Coward | more than 5 years ago | (#26117537)

It was no technicality.

They did not push a solution wich fufilled the rules for pushing a solution in the first place. So it was rejected.

Re:Senator Conroy's handiwork (2, Informative)

CaptainDefragged (939505) | more than 5 years ago | (#26117629)

No it's more like this:
Optus spent $5 million creating a 900 page bid [optus.com.au] proposing an open playing field. I don't think the details are public yet, but that link has the media release. They also fronted a $5 million bond [itwire.com] .
Telstra sent in a 14 page memo saying something along the lines of "we'll do it as long as you guarantee our infrastructure monopoly and we wont pay the bond, but we promise to put in $5 billion".
If this gets up, this is a win for all Australian Internet users. "Telstra has said entry-level access to its proposed NBN would start at $39.95 per month for a 1 megabit per second connection with 200MB of download capacity."[ref] [news.com.au] This is what we could look forward to under Telstra. More of the same shite. That 200mb includes backhaul too.

Re:Senator Conroy's handiwork (1)

mgblst (80109) | more than 5 years ago | (#26117851)

What an idiotic statement. So somehow Conroy, who is a misguided prick, forced Telstra to submit a joke bid of 12 pages, compared to real bids of hundreds of pages. Conroy strong armed Telstra to not mention small businesses, a major pre-requisite of the bid, and the reason they are kicked out of the process.

Coincidence, yes.

So, this means faster pr0n, right? (0)

Anonymous Coward | more than 5 years ago | (#26116937)

Oz has been suffering with overpriced bandwidth for a very long time.

Re:So, this means faster pr0n, right? (0)

Anonymous Coward | more than 5 years ago | (#26117691)

Australia's prices seem rather good to me. In many parts of the world, perhaps even most, you can't even get internet as fast as most Aussies can. 7Mbps is considered blazing in those places. For under $35 per month, you can get as much data as most Australians use, and at speeds of up to 24Mbps. For those who need unusually large amounts of data, additional data costs $1/GB, which is cheap.

Re:So, this means faster pr0n, right? (0)

Anonymous Coward | more than 5 years ago | (#26117999)

is this a parody? those speeds are exceptional in much of the western world and without the ridiculous limits

$1GB is also an order of magnitude more expensive than costs

Re:So, this means faster pr0n, right? (1)

Whiteox (919863) | more than 5 years ago | (#26118399)

Errmmm... $50/month buys you 12GB@1.5Mbps if you can get ADSL1 (my plan also includes 48GB off-peak). Those who can get ADSL2 get faster speeds and more capacity for the price.
Those who can't get either are on dialup or satellite, both suck very badly.

non compliant (5, Informative)

Anonymous Coward | more than 5 years ago | (#26116939)

They submit a non-compliant bid, really what did they expect.

Bid Rejected - http://www.australianit.news.com.au/story/0,24897,24800767-15306,00.html [news.com.au]
Govt hits back at Telstra - http://www.australianit.news.com.au/story/0,24897,24802044-15306,00.html [news.com.au]

Of particular interest is this snippet form the above stories:
"The independent expert panel charged with assessing the bids obtained five separate pieces of legal advice which said it could not consider Telstra's bid.

That advice was from internal government lawyers; the Australian Government Solicitor; respected private law firm Corrs Chambers Westgarth; senior counsel appointed by Corrs; and finally, the Solicitor-General, the Government's top legal advisor."

There were four conditions that RFP documents had to meet:
* The document must be written in English.
* The measurements used within must meet Australian standards.
* The proposal must be signed.
* The document must include a plan for how SMEs will be involved.

Telstra didn't submit anything for point 4. Now for a multi billion dollar proposal, you should at least submit a compliant bid. Instead they submitted a document with their own terms and promised "more information" if the Govt agreed to THEIR terms.

Re:non compliant (5, Interesting)

solanum (80810) | more than 5 years ago | (#26117069)

Mod parent up. This is all part of Telstra's brinkmanship with the government here. They tried the same thing with ADSL2, where they wanted permission to exclude/charge higher prices to competitors (despite having a monopoly on the 'last mile', so delayed making ADSL2 available to the public. In the end, the main competitors got together and put their own ADSL2 DSLAMS in place, so Telstra were forced to start allowing users onto their ADSL2 network after all.

In this case Telstra claim no one else can do it other than them, so have refused to put a proper bid in in the hope they can get more out of the government.

Re:non compliant (1)

Whiteox (919863) | more than 5 years ago | (#26118149)

Yeah but it's not Telstra per say, it's Sol Trujillo.
Evidently he stuffed up another Telco in the USA. Read about it a year ago but can't find the links. Somewhere in the mid-west I think.

Re:non compliant (1)

rsmith-mac (639075) | more than 5 years ago | (#26118237)

The document must include a plan for how SMEs will be involved.

Perhaps this is an Aussie thing, but what do they mean when they are talking about "involving" Small and Medium Enterprises? Is this about subcontracting work to other companies? Making the final service affordable to smaller businesses? Etc. It's a very non-descriptive statement.

haha (0)

Idiomatick (976696) | more than 5 years ago | (#26116941)

Thats what those trouble makers get for being against the scary Australian firewall. Or something unrelated. This summary is hard to decipher but as a proud /.er i refuse to RTFA as my forefathers did before me

Telstra tried to pull a Microsoft (3, Interesting)

QuantumG (50515) | more than 5 years ago | (#26116949)

They're afraid of being broken up (because they're a monopoly) so they tried to put conditions on their bid. The government slapped 'em back into their place. Now they're crying about it.

Nope. Telstra was anti-censorship. (0, Interesting)

Anonymous Coward | more than 5 years ago | (#26117187)

Nope. According to TFA 'The reasoning allegedly given by the Commonwealth for the exclusion is that Telstra did not include a plan for how to involve small and medium enterprises (SMEs) in the building of the NBN when Telstra lodged its NBN proposal on 26 November.' Apparently (a quickie Google search confirms this) it wasn't even the case that Telstra sought to exclude SMEs, but they simply hadn't included a proposal upfront, something which the government could easily have asked for, but they didn't. So officially, Telstra has been kicked out of the bidding process on a trivial technicality. So that can't be the real reason.
However, if you figure out who is responsible for the decision, it turns out to be the same guy who was responsible for the Australian censorship plans, which Telstra opposed. So I think that's the real reason. However, after the recent rally, the government can't get away with actually saying that, it would cost too many votes. So they offer as a substitute an opaque technicality that the average voter will not understand, with a faint suggestion of legal unavoidability.
Viewing it from this angle, the picture is relatively simple. The goverment simply didn't want a company that opposes their censorship plans to do the backbone of their national broadband network. As usual, it's all about control.

Re:Nope. Telstra was anti-censorship. (1)

QuantumG (50515) | more than 5 years ago | (#26117253)

You're on crack. Take off the tin foil hat. Telstra made demands of the government in their bid, the government declined to be bullied. It's that simple.

Re:Nope. Telstra was anti-censorship. (2, Insightful)

deniable (76198) | more than 5 years ago | (#26117767)

The government did ask for it. It was in the Request for Tender. Those things are iron-clad for a reason. If they don't bounce non-conforming tenders any slashdotter could submit a one-page proposal and expect equal treatment. Now, there's a thought.

Re:Telstra tried to pull a Microsoft (0)

Anonymous Coward | more than 5 years ago | (#26117275)

Hear hear , the 800 pound gorilla has been puled up in its tracks , they gambled and lost ........

Hope we get some real competition in the industry

No Competition? (1)

SlightOverdose (689181) | more than 5 years ago | (#26116985)

Why wouldn't the government allow them to compete?

Re:No Competition? (5, Informative)

Anonymous Coward | more than 5 years ago | (#26117041)

Govt hits back at Telstra - http://www.australianit.news.com.au/story/0,24897,24802044-15306,00.html [news.com.au]

Of particular interest is this snippet form the above story:
"The independent expert panel charged with assessing the bids obtained five separate pieces of legal advice which said it could not consider Telstra's bid.

That advice was from internal government lawyers; the Australian Government Solicitor; respected private law firm Corrs Chambers Westgarth; senior counsel appointed by Corrs; and finally, the Solicitor-General, the Government's top legal advisor."

Long story short- Telstra screwed themselves becuase they submit a non-compliant bid. They CAN'T accept the bid because if they do, the other parties that did submit compliant bids could possibly sue them.

Re:No Competition? (5, Informative)

mcbridematt (544099) | more than 5 years ago | (#26117137)

They submitted a 13 page 'proposal' at the last minute while (apparently) even the smallest of the bids were throughly detailed.

I bet when each bidder had to front the 'expert panel' on the weekend the panel decided not to waste their time entertaining a 'proposal'. Being a 13-page 'proposal' the lawyers would've had no trouble finding missing bits.

Besides, the process is pretty lame. The goal was to build the exact same proposal that Telstra came out with in 2005 - $4billion AUD for FTTN(which will be obsolete in 10 years anyway), and only do FTTH in brand new developments.

Its been pointed out [mac.com] by the head of another ISP (Internode, who I use) that Telstra could simply build a FiOS-style FTTH network and keep it to themselves, with no strings attached while the older PSTN remains. Keep in mind that Telstra's entire goal throughout this process has been to decimate the competitive environment that exists. There are ADSL2+ plans which offer 100x more value than the proposed wholesale FTTN port price!

Re:No Competition? (3, Insightful)

Nefarious Wheel (628136) | more than 5 years ago | (#26117371)

They submitted a 13 page 'proposal' at the last minute while (apparently) even the smallest of the bids were throughly detailed.

Having been in The Machine before (what Australian contractor hasn't been that hungry at least once?) I suspect they simply couldn't get it together to make the bid. Sol decimated the Telstra bureaucracy. This is both good and bad; the latter because they have utterly no clue how to communicate internally any more. No way is that executive team going to do any bid work to that level any more, they just don't have it in them. Big isn't necessarily muscular. That dog is too old to go hunting.

Re:No Competition? (1, Interesting)

Anonymous Coward | more than 5 years ago | (#26117151)

They had just as much chance as everyone else to 'compete' in this race. Telstra decided to get cocky only submitted 15 page plan with absolutely no detail because they thought they had it in the bag. Meanwhile all the other contenders put in highly detailed plans with everything that was requested by the government for consideration in the process.

Last time I checked (at least when I was in school), if your essay doesn't address the topic and doesn't meet the word count, you get a FAIL.

Re:No Competition? (1)

SlightOverdose (689181) | more than 5 years ago | (#26117191)

I should clarify my point.

They don't win the government grant, fine

But why not let them build their own network with their own money parallel to this? Explicitly forbidding this seems a little too socialist.

Re:No Competition? (1)

Gideon Fubar (833343) | more than 5 years ago | (#26117387)

They haven't been specifically forbidden. They're just not going to be in the running for this particular lot of government funding.

Telstra won't build their own network because they don't want to have to spend their own money on it. They have been given a free ride and are complaining now that they have to actually do some work.

Re:No Competition? (1)

SlightOverdose (689181) | more than 5 years ago | (#26117395)

Directly from the Slashdot summary:

"The government may now take steps to legislate so that Telstra can't build a network that competes with the NBN"

Re:No Competition? (2, Insightful)

Gideon Fubar (833343) | more than 5 years ago | (#26117457)

Yes, may. As opposed to have.

Turns out that speculation about the future doesn't directly influence fact in the present, no matter how hopeful it is.

Re:No Competition? (1)

jman11 (248563) | more than 5 years ago | (#26118447)

For the same reason you don't have a second set of water pipes running up to your house. Setting up a nationwide network of telecommunications equipment is very expensive.

Businesses competing is a great way to improve efficiency, However infrastructure is usually not done with competitive marketplaces because the large waste in constructing these redundant systems will never be reclaimed by the efficiencies introduced by market economics.

There have been numerous attempts to introduce market economics. Many western countries now have a choice of supplier or maintenance for utilities. However duplicating the entire network is hugely wasteful.

Thanks for another Australian story timothy! (-1, Troll)

Anonymous Coward | more than 5 years ago | (#26117049)

However, as much as I hate to qualify my praise, I have to say that you and kdawson are letting the side down a little: I can still see a few stories on Slashdot which aren't about Australia.

That's not really acceptable now, is it?

If we are to become the focal point of the world's attentions as we deserve to be, you and our fellow Aussies such as kdawson must spam harder than ever if we're to overwhelm sites such as Slashdot with lavish Australia-luvvin' attention.

Some Americans are still able to sleep at night without reading about every last piece of Ocker trivia, so get your arses into gear and spam! Spam! SPAM!

And to any of you stupid fat seppos* complaining about Slashdot being hijacked by us - GO AND GET FUCKED!

(*"Seppo": Google is your friend.)

Re:Thanks for another Australian story timothy! (3, Funny)

aweraw (557447) | more than 5 years ago | (#26117217)

If I may interject here for a second - your Stralyin is lacking in authenticity...

That last phrase should have been should have been: GARNGIT FARKED!

Re:Thanks for another Australian story timothy! (2, Insightful)

ElAurian (133656) | more than 5 years ago | (#26117355)

There's no L in Straya. Mate.

Re:Thanks for another Australian story timothy! (0)

Anonymous Coward | more than 5 years ago | (#26117571)

not to mention the capital on aussies.

Re:Thanks for another Australian story timothy! (2, Funny)

Anonymous Coward | more than 5 years ago | (#26117503)

hehehe.. oi dad there's a broadband network in the trading post for $15 billion...

struth!! tell em their farkin dreamin'!

Re:Thanks for another Australian story timothy! (0)

Anonymous Coward | more than 5 years ago | (#26117413)

WTF is a seppo? Have you just used urban dictionary to try and sound more Aussie for a reason?

To echo another poster, GIT FARKED, YA FARKEN TOOL

Re:Thanks for another Australian story timothy! (0)

Anonymous Coward | more than 5 years ago | (#26117595)

"WTF is a seppo?"

Septic tank = yank = seppo.

Re:Thanks for another Australian story timothy! (1, Funny)

Anonymous Coward | more than 5 years ago | (#26117775)

no shit. do you actually talk like that, or did a straayan tell you that we call you that? did they tell you about drop bears too?

Re:Thanks for another Australian story timothy! (2, Funny)

ignavus (213578) | more than 5 years ago | (#26118141)

We haven't succeeded until we have replaced all stories about Thanksgiving and Fall, etc with proper stories about Anzac Day, Two-Up, Autumn, and football codes that don't involve wearing wussy helmets.

Forget the Alamo. Remember Gallipoli.

Re:Thanks for another Australian story timothy! (1, Funny)

Anonymous Coward | more than 5 years ago | (#26118217)

football codes that don't involve wearing wussy helmets.

Australian football players don't wear wussy helmets because the game is so fucking pathetic it's not funny. It's wimpier than soccer. "oh i've got the ball and people are coming my way, better kick it high up in the air and run away screaming so that i don't get hurt".

Fucking poof sport that Australian aerial ping pong.

All or nothing bet (3, Insightful)

shirro (17185) | more than 5 years ago | (#26117203)

Sol gambled and the shareholders lost. A triumph of greed over common sense. Has his reality distortion field finally shattered?

The current Telstra management seemed to have brought a lot of anti-regulation baggage with them from the US. They seemed unable or unwilling to adapt their management style to the realities of operating in Australia.

A lower return to shareholders would still have been a return but they had to be greedy. Now they might be a footnote in the countries broadband history.

Re:All or nothing bet (5, Insightful)

c_g_hills (110430) | more than 5 years ago | (#26117255)

"Trujillo's final dramatic quote to the analysts was "Nothing Stops Telstra"." (Business Spectator [businessspectator.com.au] )

The man reeks of arrogance. Nothing good can come of letting the incumbant monopoly. I hope that Australia ends up with the network it really needs, rather than the one that Telstra has given them.

Re:All or nothing bet (1)

Antique Geekmeister (740220) | more than 5 years ago | (#26117739)

The shareholders didn't necessarily lose. Simply increasing the size of a business by taking on a new venture is not necessarily good for a business, and it's not clear this whole national network is going to make money for the providers. It could be a lead-in for more profitable services, but it could also be a huge money pit for the telco serving it if they have the wrong technologies, wrong management, or wrong policies to handle it.

In fact, from what I'm seeing about Telstra, it would probably break them to try and manage such a different service.

Next Canada (3, Interesting)

EmperorOfCanada (1332175) | more than 5 years ago | (#26117271)

Please let this happen in Canada! We have a few cell companies that simply refuse to compete. We need them barred from the next few bandwidth auctions. It was recently calculated that sending text messages in Canada costs more per byte than data sent from the Hubble telescope. Another comparison showed that what costs $1 to send via a normal high-speed connection would cost $16 Million via a cell phone in Canada. (no exaggeration)

Re:Next Canada (1)

mjwx (966435) | more than 5 years ago | (#26117343)

Please let this happen in Canada! We have a few cell companies that simply refuse to compete.

Sorry mate but we have multiple Mobile providers in Australia and they still refuse to compete on anything beyond a superficial level (just enough to keep the competition watchdog off their backs) and they will attempt to force you into a contract (difficult to find a Pre-paid plan with credit that lasts longer then 30 days in Australia, they want their monthly danegeld from you one way or another).

Also the shafting you Canadians get from your broadband providers is nothing like the shafting we Aussies get. We pay about (aboot) A$60 for 30 GB downloads and only 10 GB's can be used between the hours of 7AM and 12 AM (the 2/3rds of the day most people are awake). Add to that the A$30 line fee (Naked DSL exists here but it costs more for the actual DSL service provision and ends up being about A$10 cheaper and that's if you don't want a phone service).

I've been considering trying to find employment up in Canada to get away from the shafting and political madness here.

As usual headline is totally wrong. (5, Interesting)

timmarhy (659436) | more than 5 years ago | (#26117273)

No where does it say they are making laws to keep telstra out. they did however reject telstra's non compliant bid, and i didn't suprise me in the slightest they are sick of Trujillo's bullshit. he keeps trying to claim telstra are the only company that can build a national network. seriously who does he think he is fooling. there is a dozen companies in oz that could build a better network than telstra. this along with constant hollow threats of not building the new network, when no one wants them to be involved to begin with are enough to make anyone sick to death of them.

IMHO Trujillo needs to get it through his thick head that 15 billion in tax payers money is going to come with strings attached, like it or not.

Re:As usual headline is totally wrong. (2, Insightful)

Nefarious Wheel (628136) | more than 5 years ago | (#26117477)

Not to mention that most customers would prefer to spend their money on a vendor they can trust. With their saber rattling over regulatory constraints (and deregulation is not a popular song just now, is it?) using some fairly egregious terms, I doubt that anybody would want to spend money in Telstra's direction.

You can only insult your customers so often before you lose their attention. We know at this point it would be simply good money after bad, just like the US Bush-era Information Superhighway spend. I don't care if the competition has its HQ in Singapore. Screw 'em if we can't get a decent ROI.

Hardly a Win (0)

Anonymous Coward | more than 5 years ago | (#26117523)

This seems hardly a win for the Australian public, to have to have a Singaporean telco, with a questionable track record in regards to building and running, build and run what will be the basis of one of the most important pieces of telecommunications infrastructure that this country will build in the next 50 years.

Yeah great move Howard, selling off Telecom to Australian's [was the original idea for the sell off] so that it can be run by greedy bastards like Sol, who try to squeeze every cent out of you the customer while giving as little back as possible in regards to services.

Yeah this is real great for Australians.

Re:Hardly a Win (0)

Anonymous Coward | more than 5 years ago | (#26117931)

It's grossly unfair to characterise the likely winner of this tender as a Singaporean telco. Optus is only one member of the bidding consortium, which also includes AAPT, Internode, iiNet, Macquarie Telecom, Powertel, Primus, Soul and TransACT, and I think all of the others, except AAPT are Australian businesses. And AAPT comes from Australia's seventh state.

-- Newall

Whole sale (0)

Anonymous Coward | more than 5 years ago | (#26117549)

From what I know of the situation, it was a requirement that part of the proposal be the establishment of an independent wholesaler rather than one company owning the network. Telstra stated that they would not participate if they did not end up owning the wholesale rights to the network.

People are missing the point when they say that it will stop competition, by not letting Telstra build a second network they would be forced to buy wholesale connections to the NBN just like everyone else, breaking the monopoly that exists at the moment. Telstra have stated bluntly that they will never do this, hence Sol's statement that they would focus purely on Next-G in the event that it happens.

Re:Whole sale (1)

Whiteox (919863) | more than 5 years ago | (#26118239)

they would focus purely on Next-G
Yes, and that is a true monopoly. Next-G is totally owned by Telstra and they are not allowing anyone else to use that technology.
To be clear on this, Next-G uses 800mhz bandwidth while all the other 3G providers use 1800+mhz. What this means is that the Next-G network travels further/kilowatt than higher frequencies, and no-one else can use it.
That really stinks if you don't live in the metro areas as you are forced to use Telstra if you want reliable coverage.
The worst decision Telstra made for their customers was to get rid of CDMA. I was paying 9c/minute and now I'm up to 45c/minute. Complaints about this everywhere.

Outside the square (2, Interesting)

Nycran (1282174) | more than 5 years ago | (#26117695)

So why did Telstra not want to win this? It seems the perfect out. Submit a half baked proposal and omit an obvious required detail. It looks like they tried but actually they wanted to fail. Interesting. This might be a long term play at not having to service the whole of the country, which is unprofitable and expensive (Australia is a big desert, with dense population centers on the coast). Maybe Telstra predict better profit margins in delivering high speed data through the air, and are betting that in 10 years, data will be fast enough through the air to compete with any wired solutions. I think they want to be free from government regulations.

Re:Outside the square (2, Interesting)

MichaelSmith (789609) | more than 5 years ago | (#26117741)

So why did Telstra not want to win this? It seems the perfect out. Submit a half baked proposal and omit an obvious required detail. It looks like they tried but actually they wanted to fail. Interesting.

The loser gets to focus their workforce on profitable urban customers, while the winner sends their staff into the outback pulling cables through the desert to snare 150 homes.

They are being paid for it but it means taking people away from other tasks.

bit3h (-1, Troll)

Anonymous Coward | more than 5 years ago | (#26117789)

member. GNAA (GAY RRadt's stubborn Assholes, as they Who are intersted If you have 1. Therefore there first organization incompatibilities walk up to a play create, manufacture those obligations. the future holds that support I see the same To have regular Lube is wiped off

This is good news (1)

acb (2797) | more than 5 years ago | (#26117895)

Telstra used to be the national government-run telephone monopoly. It's now semi-privatised, though maintains a lot of its monopoly over the network (in particular, the last mile). As a profit-making entity answerable to its shareholders, it has, of course, been squeezing that for all it's worth, at the Australian consumer's expense. It's about time Telstra got smacked down.

Just when I thought Sol couldn't top his antics (2, Interesting)

agendi (684385) | more than 5 years ago | (#26118245)

I remember thinking when I heard that Ziggy had left the Telstra camp "Man I'm glad Ziggy is out and Telstra can get on with sorting itself out, after all they couldn't hire anyone worse..." Boy was I wrong.

Best Christmas present ever (0)

Anonymous Coward | more than 5 years ago | (#26118411)

Time to go dance naked in the street.

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