National $10b-plus network a step closer
- Matt O'Sullivan
- August 8, 2008
THE Federal Government is a step closer to firing the starter's gun next month for tenders to build a $10 billion-plus national broadband network after demanding crucial information about existing infrastructure from telecom companies.
Carriers including Telstra and Optus will have until August 22 to submit the final information to the Communications Department, which is expected to take a week or two to review it before it is handed to bidders. Companies need it to prepare their tenders.
Once the starter's gun is fired, the companies vying for up to $4.7 billion of taxpayers' funds will have three months to submit their proposals for a broadband network. The Government originally marked July 25 as the closing date for bids but has since moved it to the end of the year.
Telstra has been pressing the Government to speed up the process, and is sceptical about the latest deadlines. "We are now nine months into a process that should have taken six months," Telstra's chief of public policy, Phil Burgess, said yesterday.
Under Telstra's plans, Dr Burgess said, the network would cost at least $10 billion - made up of the Government's funding and about $5 billion from the telco. He would not reveal what such a price would buy because of a Government gag on the process.
Telstra's chairman, Donald McGauchie, has previously estimated the cost of a network connecting 98 per cent of the population at between $15 billion and $25 billion.
Telstra is the market's odds-on favourite, ahead of the Optus-led consortium Terria (formerly known as G9) and the Canadian telco Axia NetMedia. State-based bids are expected from the Tasmanian Government, a Canberra company, TranACT, and a Victorian group, Acacia.
Terria's chairman, Michael Egan, said he was satisfied with the time frame because it allayed concerns that the initial deadline of July 25 would not have allowed for competitive bids.
He said Terria was still confident of raising the funds - a mix of equity and debt - in financial markets despite the credit crunch. He declined to say whether Investec was still its banker.
After assessing the tenders a government panel will make a recommendation to the Communications Minister, Stephen Conroy.